Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

ASSOCIAIED BRITISH PORTS (No. 2) BILL (By Order)

Order for Third Reading read.

To be read the Third time on Thursday 6 April.

ASSOCIATED BRITISH PORTS (HULL) BILL (By Order)

BIRMINGHAM CITY COUNCIL (No. 2) BILL (By Order)

HYTHE, KENT, MARINA BILL (By Order)

LONDON UNDERGROUND (VICTORIA) BILL (By Order)

WENTWORTH ESTATE BILL (By Order)

BRITISH FILM INSTITUTE SOUTHBANK BILL (By Order)

CITY OF LONDON (VARIOUS POWERS) BILL (By Order)

REDBRIDGE LONDON BOROUGH COUNCIL BILL (By Order)

KING'S CROSS RAILWAYS BILL (By Order)

Orders for Second Reading read.

To be read a Second time on Thursday 6 April.

CITY OF LONDON (VARIOUS POWERS) BILL

Ordered,
That the requirement of S.O. 168 (Charges affecting public revenue to be printed in italics) shall be dispensed with in the case of the City of London (Various Powers) Bill.—[The First Deputy Chairman of Ways and Means.]

Oral Answers to Questions — ENVIRONMENT

Unified Development Plans

Mr. Thurnham: To ask the Secretary of State for the Environment what representations he has received about the proposed unified development plans; and if he will make a statement.

The Minister for Water and Planning (Mr. Michael Howard): The arrangements for the preparation of unitary development plans, including my right hon. Friend's strategic guidance, are well advanced. Responses are still being received to the draft strategic guidance for Greater Manchester.

Mr. Thurnham: Does my hon. and learned Friend agree that it is much better if planning decisions are made locally whenever possible, and that the Government's record is much better than that of the Labour Government in this respect? Does he also agree that when unified development plans are in place there should be far fewer appeals to the Secretary of State?

Mr. Howard: Unitary development plans should certainly improve matters further, and I expect them to lead to a much greater say for local people in the taking of planning decisions.

Mr. Conway: Does my hon. and learned Friend agree that local plans have particular significance for towns of historic importance—of which Shrewsbury is one, being among the top dozen on the Department's list of towns of specific importance? Shrewsbury, like the city of Durham is surrounded on three sides by a river and thus has particular planning difficulties, so the inspectors' recommendations to my right hon. Friend in respect of local plans are particularly important and should receive far greater credence.

Mr. Howard: My hon. Friend is right to draw attention to the importance of historic towns such as Shrewsbury. The local plan provides the framework for giving local people a greater say in these matters. The sooner all local planning authorities make progress in the preparation of these plans, the greater their voice will be.

Water Privatisation

Mrs. Mahon: To ask the Secretary of State for the Environment when he last met the chairmen of the water authorities to discuss water privatisation.

The Secretary of State for the Environment (Mr. Nicholas Ridley): On Monday.

Mrs. Mahon: Has the Minister seen the letter sent to Members of Parliament by Gordon Jones and the chairmen of nine other water authorities? If so, does he agree that water has deteriorated under their stewardship? They have never fought for the industry, and now they are saying that it would be better off privatised. Does not the right hon. Gentleman believe that they have a vested interest in privatisation, and should he not ask them to resign, given that they have not looked after the industry?

Mr. Ridley: I am grateful to the hon. Lady for drawing attention to the excellent and impartial briefing that the water authority chairmen issued for the Report stage of the Water Bill. The fact emerges clearly from that, as I am sure the hon. Lady will agree, that maladministration by the Labour Government is primarily responsible for the wretched condition of some rivers, including those in her area.

Mr. Heddle: Does my right hon. Friend agree that because of their incompetent management of the economy the Labour Government drastically cut investment in the water industry and in sewage treatment? Does he agree that the better way to get cleaner rivers, better beaches and new sewers is to denationalise the industry and release it from Treasury control?

Mr. Ridley: I entirely agree. It is a tragedy that we are having such a problem cleaning up the legacy of Socialism, which is to be equated with pollution on every occasion.

Mr. Winnick: Can the Secretary of State explain why, despite the massive amount of Government propaganda and his undoubtedly brilliant persuasion, the overwhelm-ing majority of people in this country wholly reject the irrelevant, stupid nonsense of water privatisation?

Mr. Ridley: I am afraid it is true that the matter has been handled neither well nor accurately by the Opposition.

Mr. Rathbone: When my right hon. Friend met the chairmen, did he draw comparisons between the way in which the French independent water companies have raised the standards of water in their country and the sad performance of water companies and authorities in this country?

Mr. Ridley: It is not without interest that France—which, under its present Administration, is not loath to nationalise—has set its face against interfering with the highly successful performance of its privatised water industry.

Mrs. Ann Taylor: When the Secretary of State met the chairmen, did he discuss spending on advertising? Does he agree that it is wrong for the chairmen of publicly owned water authorities to refuse to say how much public money has been spent on selling the Government's privatisation policies? Do not the paying public have a right to know? Or does the Secretary of State think that, in anticipation, of privatisation the appointees concerned should stop behaving like public servants and start behaving like the Government's political lackeys?

Mr. Ridley: No, I do not agree. The water industry has every right to publicise its achievements and its wares and to make clear to the House what it believes to be the best way of achieving the increase in standards and efficiency that the country wants. It is strange that the hon. Lady should whinge and twinge because a publicly owned industry does not agree with her very foolish policies.

Housing (Marginal Land)

Mr. Stern: To ask the Secretary of State for the Environment if he has any plans to increase the availability of marginal land for housing.

Mr. Howard: The allocation of land for housing is primarily a matter for local planning authorities. However, authorities are encouraged to make maximum use of derelict or underused land in urban areas, and only last month we announced proposals by which local authorities in rural areas could permit low-cost housing for local needs to be built on land where planning permission for housing would not normally be granted.

Mr. Stern: I thank my hon. and learned Friend for that reply. Is he aware that in Bristol it is almost impossible for a young couple on average or below average earnings to obtain any form of housing in or near the city? Does he agree that removing any possible planning obstacle to the development of difficult and therefore probably low-cost land would help the housing problems in our cities?

Mr. Howard: I am sure that my hon. Friend is right. I hope that the authorities in Bristol and elsewhere will study closely our recent announcement, which should go a considerable way towards alleviating the problem.

Mr. Andrew F. Bennett: Is the Minister aware that under his proposals he is trying to persuade the local authority in Stockport to find more land for housing than the local authority wants? Is he aware that between my constituency in Manchester and that of his hon. Friend the Member for Stockport (Mr. Favell) a considerable area is currently used for golf courses or poor quality farm land? That area constitutes an ideal breathing space between the cities of Manchester and Stockport. Will he ensure that permission is not granted for building on that land, which would deny many people access to land on which they enjoy walking?

Mr. Howard: All applications for planning permission on that land and elsewhere should be dealt with on their merits and in accordance with the circumstances of the case. That is the basis on which they will be dealt with.

Mr. Steen: Does my hon. and learned Friend agree that there is no need to take marginal land or green field sites for housing when there are more than 80,000 acres of vacant and under-used public land on the registers? Those registers are eight years old. Although the Government keep saying that they want to do more, the registers continue to grow and more land will continue to come on to them unless my hon. and learned Friend does something about selling the vacant, derelict or dormant public land.

Mr. Howard: I am sure that my hon. Friend would not want to ignore the substantial amount of land that has been taken off the register. We are making substantial progress. My hon. Friend is right to draw attention to the opportunities that exist, which are being rapidly exploited.

Homelessness

Mr. Simon Hughes: To ask the Secretary of State for the Environment if he will seek to amend the homeless persons legislation to give local authorities a duty to make accommodation available for people under the age of 18 years who are homeless.

Mr. Roy Hughes: To ask the Secretary of State for the Environment what new proposals he has to combat homelessness.

Mr. Ridley: My review of the homelessness legislation is not yet complete. I will announce the result as soon as I am ready to announce my conclusions, but it would be premature to speculate on whether any changes are to be made to the legislation.

Mr. Simon Hughes: Is the Secretary of State aware of the vicious circle confronting young people in London? They cannot get jobs because they have no homes, and they cannot get homes because they have no jobs. They end up—to use a phrase with which the right hon. Gentleman is familiar—"skippering", or sleeping rough. Given that the Government have billions of pounds to spare, will the Secretary of State assure the House that on completing his review he will address head-on the problem of youth homelessness in London? Will he ensure that positive measures are taken to address the present appalling position so that many of the young homeless in our capital are housed later this year and in the future?

Mr. Ridley: I am sure that the hon. Gentleman agrees that we should do nothing to tempt young people to leave home, particularly when they do not have a home of their own to which to go. That is half the problem that we already face, and the hon. Gentleman's suggestion would exacerbate it. Over the past year, an additional £74 million has been made available to local authorities to deal with the most acute problems of homelessness, together with approval of £40 million additional housing association capital receipts to be spent on schemes focused on helping homeless families. That is a major contribution, despite the fact that there are still far too many empty council houses which could be used.

Mr. Roy Hughes: Is not the increase in homelessness a direct result of Government policies, as manifested by high interest rates, which lead to mortgage defaults and repossessions? Is it not due also to the Government's failure to allow local authorities to build houses for rent, which less well-off families so urgently need?

Mr. Ridley: The percentage of households rendered homeless as a result of mortgage arrears is declining, from 10 per cent. of those for whom local authorities accepted responsibility to find accommodation in the third quarter of 1987 to 7 per cent. in the third quarter of 1988. That does not bear out the hon. Gentleman's allegation.

Mr. Wells: Does my right hon. Friend agree that to make housing available to those under age 18 would encourage the break-up of families and lead to a serious situation in which young people would be encouraged to leave home and come to the capital looking for accommodation?

Mr. Ridley: My hon. Friend is absolutely right. There would be some encouragement for young people to leave home in the mistaken belief that it might be a way of jumping the queue for council housing. I hope that young people will not think that. I equally concede, as would my hon. Friend, that there are a number of genuinely homeless people who cannot return home, and it is those whom we should seek to help.

Mr. Colvin: Is my right hon. Friend aware that it costs £180 per week to house a homeless family in bed-and-breakfast accommodation in my constituency, yet there are areas of derelict land—often in local authority ownership—and builders with low-cost housing

schemes which together could provide accommodation for young homeless families at a lower cost per week than that of bed-and-breakfast accommodation? Will my right hon. Friend's Department be favourably disposed towards planning applications and, in particular, to appeals in relation to schemes of that nature?

Mr. Ridley: I have tried to take further measures to help in that kind of situation, with the announcement in February that local authorities can give planning consents for low-cost housing for local people as well as meeting their general housing provision obligations. That does not have to he in the most rural areas. It is one of the many routes already available whereby local authorities can secure extra housing provision, at the capital expense often of the private sector or of the Housing Corporation. I urge them to use it.

Mr. Soley: Why has the Minister created such an acute shortage of low-cost accommodation in Britain?

Mr. Ridley: I do not believe that I have created any such shortage. I believe that the shortage of housing resulting from a very restrictive planning policy pursued by many local authorities in the south of England has contributed to it. If there were enough houses for everyone, it would be possible for everyone to be housed, but in a housing shortage low-income families are inevitably last in the queue.

Land Registers

Dame Janet Fookes: To ask the Secretary of State for the Environment how many requests he has received to include specific vacant sites of under one acre on the land registers.

The Parliamentary Under-Secretary of State for the Environment (Mr. David Trippier): Since 1985 to the end of February 1989, requests have been received for registration and disposal in respect of a total of 225 sites, of which 46 were for the registration of sites smaller than one acre in size.
In 1988, the amount of land on the land registers decreased by 6,175 acres.

Dame Janet Fookes: I welcome the information given by my hon. Friend. Does he agree that the position regarding land would be clearer if all sites under one acre were included on the register and a supplementary register were kept of privately owned land, bearing in mind that the present register is for publicly owned land only?

Mr. Trippier: Under the present arrangements, the figures reflect that there has been considerable success in the removal of all land, public and private, from the register. The Ordnance Survey 1988 survey shows a further reduction of 4,199 acres of vacant land, a significant improvement on the previous year. That demonstrates that the policy is very successful.

Mr. Skinner: Is the Minister aware that many of those small plots of land are covered with litter? Will he ask the Secretary of State for the Environment to inspect every one of those sites, taking with him a little bag and the Prime Minister? Then he can bag it and bin it and stick her in it.

Mr. Trippier: The hon. Gentleman makes his own contribution to the amount of rubbish by the speeches that he makes in the Chamber. I do not imagine that he is making a very good job of setting an example in his own constituency as he certainly makes a significant contribution to the rubbish here.

Housing Associations

Mr. French: To ask the Secretary of State for the Environment what was the level of home starts by housing associations at the latest date for which figures are available; and what is the level expected to be reached as a result of the increase in funding for the Housing Corporation announced in last year's Autumn Statement.

Mr. Ridley: A total of 14,651 approvals had been given by the Housing Corporation in the current financial year up to the end of February. In 1991–92 the corporation expects to approve more than 32,000 homes for rent and sale.

Mr. French: Does my right hon. Friend agree that the figures that he has given are ample proof of the housing associations' ability to provide affordable housing for those in need? Does he accept that the huge increase in public funding provided to the Housing Corporation, coupled with private finance and the management skills within the housing associations is enabling those housing associations to achieve an impact on local provision which has not been emulated by many local authorities?

Mr. Ridley: The figures show that the gross provision for the Housing Corporation programme was £1,328 million for 1991–92—an 80 per cent. increase on the original provision for the current financial year. That has since been increased by a further £40 million because of greater than expected capital receipts. That is a massive expansion. I agree with my hon. Friend that it should make a very great contribution, particularly as it is possible to target it on the areas of greatest need.

Mr. George Howarth: Will the Secretary of State confirm that in areas of low values or high costs housing associations are having difficulty making private finance work and that the only way in which they can make it work is by reducing standards?

Mr. Ridley: The areas of greatest need are not the areas of lowest cost. When I said that it is important to target finance, I had in mind the comments made by the hon. Gentleman's hon. Friends, that the main problem of shortage of rented houses arises in the south-east and London. That seems to tie up very nicely.

Mr. Key: I congratulate my right hon. Friend on his housing associations policy, which is reaching the village communities that we are anxious to preserve in rural constituencies. Will he confirm that private finance was introduced in a new way to the housing scene under the Housing Act 1988? Is he aware that locally politicians are anxious to promote new concepts of private finance, which they opposed when the Housing Bill was before the House, and that a scurrilous and dishonest campaign is being led by the Democrats in Wiltshire?

Mr. Ridley: The latter, including the adjectives, would not surprise me in the least. I confirm that we hope that by 1991–92, about 80 per cent. of schemes will be mixed

funded. Total public provision will not only be increased by 80 per cent. it will be greatly enhanced by whatever private finance can be attracted to swell it still further. This is by far the best way to obtain value for money. I hope that all authorities—even Liberal, Democratic or whatever they are called—will realise the importance of these new measures.

Housing (Leicester)

Mr. Janner: To ask the Secretary of State for the Environment if he will make a statement on the housing investment programme allocation to Leicester city council for 1989–90.

Mr. Trippier: Leicester city council has been given a housing investment programme allocation of £8,555 million for 1989–90. It plans to add £43 million to this from capital receipts, most of which will be spent on improving and repairing the council's housing stock.

Mr. Janner: Is the Minister aware that that is a reduction in real terms of 26 per cent. in the allocation for the current year and will cause the gravest problems to the council's renewal strategy programme for private housing? Does he appreciate that there are 10,000 applications on the housing list representing 25,000 people? Does he accept that this disgraceful gutting of the council's housing programme yet again is unacceptable and intolerable?

Mr. Trippier: I am sorry to have to argue again with the hon. and learned Gentleman. He chooses to ignore the amount of money—£43 million—drawn in by the local authority in capital receipts under the exercise of the right to buy, which is Government policy. He also chooses to ignore that amount of estate action funding that has been made available. It is only recently that Leicester city council has been prepared to work in partnership with the Department on that scheme. The hon. and learned Gentleman further chooses to ignore the fact that the council could increase right-to-buy sales and thus draw in further capital receipts. The hon. and learned Gentleman seems to be interested only in council housing and does not recognise that the substantial increase that we have given the Housing Corporation will enable more housing associations in Leicester to build more houses for those on low pay.

Mr. Jim Marshall: If the Minister will cool down, I am sure that he will recognise that in my constituency and that of my hon. and learned Friend the Member for Leicester, West (Mr. Janner) there is a specific problem with Boot houses, which were built more that 60 years ago and have been found to have serious structural faults. As the Minister knows, Leicester city council has a demolition and rebuilding programme. Without doubt, leaving all political comments aside, it will experience severe problems. Will the Minister give a guarantee that, in specific and agreed circumstances, if a programme such as the demolition and rebuilding of Boot houses is placed in jeopardy he will be prepared to consider each case and, if necessary, allow increased additional expenditure?

Mr. Trippier: I am prepared to look at the problems with Boot houses in Leicester. I have already had one meeting in Leicester with Leicester city council. I am sympathetic to the problems the council faces with Boot houses and I have already made it clear that we would


assist, wherever possible, with the additional private finance that the council is trying to secure. I understand that it is being successful in that regard. I still believe that, with the flexibility of the estate action programme, it is possible to help with the renewal programme in that part of Leicester. If the city council wishes to talk to me again with the hon. Gentleman or his hon. Friends, I am only too happy to meet it.

Mr. Tredinnick: Can my hon. Friend confirm that Labour-controlled Leicester city council has the worst record for reletting council homes in the whole of the east midlands?

Mr. Trippier: I can confirm that.

Mr. Janner: The hon. Gentleman knows nothing about it.

Mr. Trippier: My hon. Friend seemingly knows more about Leicester than does the hon. and learned Gentleman, whose constituency is in the city. What my hon. Friend has said is not fantasy or fiction, but fact. Leicester has the highest percentage of void stock. The total is 1,220, which is in excess of the number of homeless people registered in the whole county.

Neighbourhood Councils

Mr. Matthew Taylor: To ask the Secretary of State for the Environment what guidance he proposes to give to local authorities intending to devolve power to neighbour-hood councils.

The Minister for Local Government (Mr. Selwyn Gummer): My guidance is to embrace the high aspirations, but to avoid the chaotic practice of Tower Hamlets.

Mr. Taylor: I welcome the Minister's statement about neighbourhood councils, as he accepts clearly that they are a progressive way to devolve power to the local communities. As the Minister knows, the rules about proportionality in the Local Government and Housing Bill may affect neighbourhood councils and he has said that he may take some action. Can he say what action he will take to ensure that the Bill does not conflict with the desire to devolve power?

Mr. Gummer: We are discussing the matter with local authority associations and have concluded that my right hon. Friend the Secretary of State will have powers under the Bill to make such regulations as are needed to enable neighbourhood councils to operate on a different basis. I hope that the hon. Gentleman will do his best to encourage the neighbourhood councils in Tower Hamlets to organise themselves so that we know how much they are spending and whose money it is.

Mr. Robert G. Hughes: Does my right hon. Friend accept that the people of Tower Hamlets thought that nothing could be worse than the old-fashioned carthorse of Labour control that had done so much damage to Tower Hamlets for so many years? But they were wrong. When the Liberals took control and introduced the neighbourhood councils, the people realised that the Liberals could be worse than the Labour party.

Mr. Gummer: There is a major difficulty about helping Tower Hamlets at pesent because the council cannot tell us with any certainty about the financial pickle it is in. Until we know how big the pickle is, it is difficult to give advice.

Mr. O'Brien: Is the Minister saying that all parish councils, town councils and community councils mirror Tower Hamlets? Will he apologise to the local authorities associations, which he says he has met on this very issue, because there are a number of local authorities that we believe are doing a splendid job? The Minister should agree and appreciate the work that those authorities are doing. He should not assume that such councils mirror the scurrilous information he has been given by his colleagues.

Mr. Gummer: The hon. Gentleman cannot have read the question, which is about neighbourhood councils and not parish councils, of which I am thoroughly in favour and of which there are many in my constituency. The technical expression "neighbourhood councils" refers to councils such as those in Bethnal Green, Bow, Globe Town, Isle of Dogs, Poplar, Stepney and Wapping. The hon. Gentleman should read the question before he asks one of his own.

Planning Appeals

Mr. Rathbone: To ask the Secretary of State for the Environment when he last reviewed the guidelines for granting costs against planning authorities when his Department gives planning permission on appeal.

Mr. Howard: A thoroughgoing review preceded the issue, in February 1987, of the current guidance in circular 2 of that year. The practical operation of the guidance is kept under continuing review.

Mr. Rathbone: Does my hon. and learned Friend accept that the present guidelines may give too much leeway to Government inspectors? Will he note that appellate costs are too often given against a council when permission is granted on appeal and that they often completely overlook important planning considerations and negate the proper functions of the planning authority?

Mr. Howard: If that were so, the councils concerned would have a remedy by way of judicial review. My hon. Friend will be aware that in two recent and important cases my right hon. Friend the Secretary of State has made what will undoubtedly turn out to be substantial awards of costs against developers. I assure my hon. Friend that the policy is applied in an even-handed manner.

Mr. Haynes: Not many moments ago, a Conservative Member congratulated the Secretary of State; I reckon he is useless, and I mean that. I should like my local authority to become involved in planning for housing. Are the Secretary of State and the Minister for Water and Planning aware that we have not built any new properties in Ashfield since 1979, when that lot over there came into power? It would be nice to be able to use planning procedures to build for the youngsters who queue up at my surgery on Saturday morning and who cannot get properties in which to live. The Secretary of State ought to be ashamed of himself.

Mr. Howard: I hope that the hon. Gentleman will refer his local planning authority to the Government's policies, including those announced last month, which will give it


ample scope to make proper provision for land for development to provide houses for the very people to whom he has referred.

Sewage

Mr. Kennedy: To ask the Secretary of State for the Environment how much untreated raw sewage is poured into the sea each year.

Mr. Ridley: About 14 per cent. of the sewage from England and Wales is discharged to the sea where it is treated through the disinfecting actions of salt water, sunlight and waves which together break down the bacteria as effectively as inland treatment. That is why the Royal Commission on environmental pollution concluded in its 10th report that with well-designed sewage outfalls, discharge of sewage to the sea was not only acceptable but environmentally preferable in many cases to alternative means of disposal.

Mr. Kennedy: I thank the Secretary of State for that detailed reply. I realise that this matter falls within the ambit of the Scottish Office, but it also has general environmental interest, given the outfall area. Will he note that Highland regional council is currently backing a limited water sewage water treatment scheme locally, which is opposed by Ross and Cromarty and Inverness district councils and which has not so far been the subject of an environmental impact assessment? The Secretary of State for Scotland has refused to call it in. As the Prime Minister now poses as the green goddess, will the Secretary of State for the Environment invoke her name to encourage the Scottish Office to take a more responsible line, given the possible pollutant effects of the scheme?

Mr. Ridley: As the hon. Gentleman knows, that is a matter for my right hon. and learned Friend the Secretary of State for Scotland. I would like to make the general point, however, that the best environmental option might well be to put the sewage out through a long sea outfall. That is what the experts recommend in many cases.

Sir Anthony Meyer: I am sorry to tell my right hon. Friend that I see no chance whatever of persuading my electors in north Wales to accept that answer. The plain fact is that sewage is being washed back on to our beaches, and we want to know how the new Water Bill will improve matters.

Mr. Ridley: I agree that there are many completely inadequate short sea outfalls, many of them dating from the Victorian era. That is why we have a major programme to extend outfalls to between 2 and 3 km out to sea so that the disinfecting action of the sea has time to act on the effluent before it can float back to the beach.

Mr. Pike: Does the Secretary of State realise that if he gives answers like that, people will not believe for one moment that the Government have any commitment to green solutions or to dealing with problems of pollution? Will he note, in particular, the opposition in Lancashire to the proposed extension of the Rossall sewage outfall near Fleetwood, to which there is overwhelming opposition and will he say that he is not prepared to let the North West water authority's proposal go ahead?

Mr. Ridley: Without reference to that particular application, which is before me at the moment, let me say

something serious to the hon. Member for Burnley (Mr. Pike). Let me tell him that the alternative is inland sewage treatment works, which produce sludge which must be disposed of either in fertilisers, or by dumping on land or at sea or by incineration. This involves the discharge of high concentrations of bacteria in the area of the seaside resort although such works are difficult to site at seaside resorts. Disinfection is a possibility, but so far there is little experience of its use and there is concern about its possible effect on the marine biota. If the hon. Gentleman does not want a long sea outfall in any particular case, will he say which alternative he wants, where he would site that alternative sewage works and how strongly he would defend the destruction of molluscs, animals and fish in the sea due to the disinfection? He must be a little more scientific and a little less shambolic.

Mr. Oppenheim: Is it not a little inconsistent—but also rather typical of certain people—to complain on the one hand about poor water quality and sewage on beaches and in the next breath to complain about the higher water charges that are necessary to clean up the mess left by years of under-investment by the public sector water authorities?

Mr. Ridley: With regard to that sort of doublespeak, I have a leaked letter from the hon. Member for Copeland (Dr. Cunningham) to my right hon. Friend the Prime Minister. I shall quote a sentence from it. It says:
Major increases, many in excess of 30 per cent., are being imposed on 12 million consumers who are being obliged to pay substantial additional costs as a direct consequence of privatisation.
That is not the case. The major environmental improvements requested by the Opposition are the cause of the increases in water charges. The hon. Member for Copeland knows that, and he should withdraw his offensive remark.

Dr. Cunningham: As the Secretary of state has now admitted that large amounts of untreated domestic sewage flow into the seas around Britian, will he tell us whether the Prime Minister was confused in her interview on the BBC "Nature" programme, when she said that no untreated sewage went into the sea around Britian? If she was not, had she again been wrongly briefed?

Mr. Ridley: Was the hon. Gentleman confused when he wrote to the Prime Minister and said that the cost of environmental pollution could be put down to privatisation? When he withdraws that comment, I shall answer his question.

Beaches

Mr. Ron Brown: To ask the Secretary of State for the Environment what representations he has received on the number of beaches which do not conform to European Economic Community standards; and if he will make a statement.

Mr. Howard: We have received a number of representations about bathing water quality. As I announced on 22 February we are making good progress in cleaning up our bathing waters—two thirds of which now meet European Community standards, compared with 55 per cent. in 1987. We are the only member state in the Community to be developing a programme for achieving full compliance.

Mr. Brown: Although recently there have been some long overdue improvements to bathing waters, is it not clear that the Government have been complacent for too long? The Government should remember that there are many floating voters who expect the water around the coast to be at least to the standard of the average European country. However, some 300 million tonnes of raw sewage a day are being pumped into the coastal areas around Britain, in addition to the dumped toxic chemicals. That is an untenable position. If the Government are turning green instead of blue, it is about time that they did something about the problem. After all, it is not an issue to be sniffed at.

Mr. Howard: Before the hon. Gentleman accuses the Government of complacency, he should reflect on the fact that the Community's bathing water directive was promulgated in 1975, when it gave two years for the designation of bathing waters. However, when the Opposition left Government in 1979 not a single bathing water had been designated.

Mr. David Shaw: Will my hon. Friend consider the beaches at Dover and Deal? Will he in particular—[Interruption.]

Mr. Tony Banks: Who did the hon. Gentleman's research?

Mr. Speaker: Order.

Mr. Shaw: Will my hon. Friend consider the fact that the beach at Deal has problems because the Opposition, when in power, did little to improve it, especially when a Labour Member was representing that constituency? Now that a Conservative Member represents that constitutency, will my hon. Friend consider the representations of that Member and ensure that the beach at Deal is improved in the near future? [Interruption.]

Mr. Speaker: Order. The hon. Gentleman has done very well.

Mr. Howard: I am sure that my hon. Friend has made his representations to the Southern water authority. Substantially more money is being made available for the improvement of bathing waters and more still will be made available when the industry is in the private sector.

Mr. Win Griffiths: Will the Minister confirm that in his answer to my hon. Friend the Member for Edinburgh, Leith (Mr. Brown) he misled the House by saying that the British Government are the only ones who have presented a plan to Brussels for the improvement of the bathing beaches of Britain, because, up until yesterday afternoon, the Commission informed me that it was expecting a plan from the British Government by the middle of March, but that it had not received it? Furthermore water authority officials have been told not to speak about investment programmes for the beaches, as I found out when I telephoned the Welsh water authority last week.

Mr. Howard: When the hon. Gentleman checks Hansard tomorrow he will find that he has accused me of saying something quite different from what I said.

Dame Elaine Kellett-Bowman: Can my hon. and learned Friend tell me how we stand in the European clean beach

league and how much progress we have made since the Labour Government cut sewage disposal expenditure by 50 per cent.?

Mr. Howard: I wish that I could tell my hon. Friend how much progress we have made, but as they did not designate any beaches or keep any records it is impossible to make such a comparison. Our position in relation to other European countries is improving substantially and the pace will quicken when the industry is in the private sector.

Mr. Allan Roberts: Does the Minister accept that none of our south-coast beaches will conform to EEC standards if the lindane in the container that has sunk in the English Channel leaks into the sea? To what extent are the beaches and the marine environment at risk from the accident? What action have the Government taken to deal with the threat? Has there been a dispute between the French and British Governments over it? Where was the ship going before it sank and why were those deadly cancer-causing chemicals being transported? What was their intended use? Will he follow the Japanese and Swedish example by banning the use of lindane in Britain?

Mr. Howard: I do not see how banning the use of lindane in Britain would have had any effect on what happened in the Channel the other day. The hon. Gentleman knows perfectly well that the French authorities are doing their best to recover that cargo and I hope that he will join me in wishing them all success.

Mr. John Marshall: Does my hon. and learned Friend agree that it is ridiculous for Opposition Members to complain about the present state of the water industry and then to argue that there should be no change in that industry? Does my hon. and learned Friend agree that all the Labour party complaints underline the case for privatisation?

Mr. Howard: My hon. Friend is absolutely right. The hon. Member for Dewsbury (Mrs. Taylor) has been wandering round the country pointing at various dirty rivers as though to suggest that that in some way undermines the case for privatisation; but it makes the case for privatisation. That is the way in which we shall gain the extra resources necessary to achieve the improvements in our water environment that we all want to see.

Water Rates

Mr. Bill Michie: To ask the Secretary of State for the Environment what is his latest estimate of the average percentage increase in water rates in 1989–90.

Mr. Howard: The estimated increase in all water and sewerage charges is likely to be about 11 per cent.

Mr. Michie: How can the Minister pretend that privatisation will not cost the consumer more money when West Kent has put up its rates by 42 per cent. and has informed its consumers that 21 per cent. of that rise is due to the possible cost of privatisation and will have no effect on the improvement of the quality of the services or the water?

Mr. Howard: I have looked carefully at West Kent's figures and most of the increase to which the hon.
Gentleman refers is the result of ownership and accounting changes, which could take place at any time. The proposals in the Water Bill will put in place an entirely new system of regulating prices. If the hon. Gentleman wants to see the prices of such companies controlled he should join me to ensure that the legislation is on the statute book as soon as possible.

Dame Peggy Fenner: Will my hon. and learned Friend assure me that in respect of the charges being made by the West Kent water authority—which the hon. Member for Sheffield, Heeley (Mr. Michie) has no locus to represent —he will make sure that next year it is not able to put on 42 per cent. on the basis that it must pay—I appreciate that it will have to do so—for the EC regulations?

Mr. Howard: I assure my hon. Friend that in assessing any price rise which may be applied for by the West Kent company next year, we shall be able to take into account its increase this year, and we shall certainly do so.

Ms. Walley: Does the Minister appreciate that the need to make profits will be the overriding issue and that that must be borne in mind when considering the level of water rates? Does he further appreciate that it is unfair that the standing charge proportion of the water rate should have been increased so disproportionately that in some cases it has made it more difficult for low-income households to pay their water bills?

Mr. Howard: The Director General of Water Services will be able to look into all such matters when the Water Bill becomes law. Will the hon. Lady join me in ensuring that it is on the statute book at the earliest possible moment?

Planning Decisions

Mr. Hunter: To ask the Secretary of State for the Environment if he will take further measures to ensure that planning authorities reach decisions more quickly.

Mr. Howard: There is considerable scope within the existing system for planning authorities to reach decisions more quickly. In the longer term, our proposals for streamlining the system should make it easier for them to reach speedy decisions.

Mr. Hunter: The White Paper draws attention to the fact that planning delays can increase costs for individuals and companies, but it does not go into details on why local planning authorities should be more efficient and streamlined under district development plans than under the existing local plans. Can my hon. and learned Friend explain?

Mr. Howard: We shall substantially reduce the delays associated with the preparation and approval of structure plan by attaching greater weight to the local plan. We shall ensure that local people have a greater say and that there will be greater certainty in the process, and I hope that that will lead to fewer appeals.

Mr. Eastham: The Minister and his hon. Friend the Member for Basingstoke (Mr. Hunter) talk about streamlining and speeding up the machinery. Is it not a fact that for several years the Government have been cutting local authority expenditure on manpower and that that must result in fewer planning officers and civil engineers,

who are essential for considering planning applications? Is it not a fact that if there are fewer personnel to process applications, the machinery will be slower?

Mr. Howard: If local authorities, including those in Manchester, spent their money on more appropriate purposes than those on which they in fact spend it, they would have ample resources to devote to making the planning system work more efficiently.

Mr. Dykes: Does the Minister agree that it is equally important for local authorities to be coaxed by the Government into providing wider consultation with local residents on planning matters and giving them more time in which to register their approval or objections? Is he aware that far too many rapacious and greedy developers, such as Charles Church in my area and in the home counties, are, unlike decent developers, appealing automatically and putting in another application at the same time? Is he further aware that when the appeal is carried in their favour they make supernormal, huge profits in building socially useful housing such as luxury apartments costing £300,000 each? When shall we get a greater balance between the interests of local residents and decent developers?

Mr. Howard: The way to achieve the best balance is to have as many local plans in place as possible. That is my advice to my hon. Friend, and I hope he will make sure that his local planning authority acts accordingly.

Mr. Loyden: Will the Minister agree that it is time for planning legislation to be reviewed in view of the fact that many planning authorities are compelled—for example, by high unemployment and general deprivation, particularly in inner cities—to reduce their planning levels to the point where they must concede that a development that may not be in the interests of good planning is nevertheless required for commercial development and the provision of jobs? Will he further agree that it is time that the trend that planning is following was arrested in the interests of the long-term planning of our towns and cities?

Mr. Howard: We have been reviewing the planning system. We announced the results in our White Paper in January.

Rate Increases

Mr. Harry Greenway: To ask the Secretary of State for the Environment what is the average rate increase for 1989–90; and if he will make a statement.

Mr. Gummer: It looks as though domestic rates are likely to rise by an average of 8 or 9 per cent., but the London borough of Ealing has agreed a rise of 32 per cent.

Mr. Greenway: Is it not preposterous that the London borough of Ealing should have proposed a rate rise of 32 per cent. this year, having passed a rise of 65 per cent. no more than two years ago? The current increase is accompanied by £12 million cuts in essential services such as street cleansing, refuse collection and the opening of borough libraries while there have been increases in the gay and lesbian staff unit. Is my right hon. Friend aware that there have been no refuse collections in some parts of my constituency since before Christmas? Is not that a disgraceful indictment of the borough in which the leader of the Labour party lives?

Mr. Gummer: I am sure that my hon. Friend will have noticed that the residents of the borough in which we both live have shown their feelings about the rate rises by an 18 per cent. swing in a by-election to elect a Conservative rather than a Socialist. I have to tell my hon. Friend, though, that the London borough of Ealing is not the worst. Brighton has put up its rates by 57 per cent., although Conservative-controlled Hove next door has cut its rate by 100 per cent. and is not levying a rate at all.

Mr. Tony Banks: Will the Minister tell us what the rate increase for Westminster is? Will he also tell us what he would say about a Labour-controlled local authority that sold off its cemeteries for 15p, that was gambling on the stock market and that was totally corrupt and inefficient? What would St. Gummer say about that?

Mr. Gummer: The rate increase in Westminster is 10 per cent. as against 32 per cent. in Ealing. If I lived in Westminster, the services and the quality of the services that I got would be very much better than those in the London borough of Ealing, where they are very bad indeed.

Mr. Bowis: Does my right hon. Friend agree that in Wandsworth the rates are still the lowest in inner London? Does he agree that much of that is due to the fact that Wandsworth has led the way in competitive tendering? When the services have gone out to the private sector there have been savings of 33 per cent.; even when they have stayed in-house there have been savings of some 25 per cent.

Mr. Gummer: The Audit Commission certainly supports my hon. Friend. I am interested to see that the effect of competitive tendering is spreading everywhere. When I met Councillor Bookbinder in Derbyshire, he admitted that the effect of competitive tendering, which he was against and which he had a whole committee to try to stop, was already bringing down the costs of his services, much to the dislike of NALGO and NUPE.

Mrs. Mahon: Is the Minister aware that if Calderdale, a hung council, had back the rate support grant that has been taken off it since 1979, it would have been able to have a nil rate rise this year?

Mr. Gummer: I am aware that Calderdale has put up its rate in a disgraceful manner, and that it did so with the support of the Liberals who ran their usual operation, which was to pretend that they were against the rate rise but then not to vote on it—and therefore enable the Labour party to get it through. That is the sort of thing the Liberals go in for.

Mr. Holt: Would my right hon. Friend care to put himself in the position of a ratepayer in Langbaurgh? When the rate demand fell on the doormat this week the

ratepayers found that their district authority had the highest rate in England and that their town councils were charging them 2p in the pound. Is he aware that in Cleveland county we have the highest rate poundage on top of that, at 299p in the pound—21p in the pound higher than any other county? Does he agree that when we have a change of control in Cleveland after the council elections in May the people in that area will have a much fairer deal?

Mr. Gummer: The only person who is in favour of Cleveland county council is Mr. Bookbinder, the leader of Derbyshire county council. Because Cleveland's rate rises have been so great, it has pushed him off the top of the list, where he has been for some time. Cleveland has replaced Derbyshire as the highest-rated county in England. My hon. Friend will note that the higher the rates, the more likely the council is to be run by Labour, and that on average it costs a person £100 a year more to live under a Labour council than under a Conservative council.

Chlorofluorocarbons

Mr. Wallace: To ask the Secretary of State for the Environment what progress is being made in his efforts to replace chlorofluorocarbons in refrigerators.

Mr. Ridley: By the end of this year, European manufacturers of domestic refrigerators and freezers expect to reduce by 45 per cent. the CFC content of their products controlled by the Montreal protocol. New replacements for the CFCs, both as refrigerants and in the insulating foam, have been identified and should be commercially available early in the 1990s, subject to the satisfactory completion of toxicological testing and environmental evaluation. HCFC-22, which is much less damaging than the protocol CFCs, is already widely used in commercial and industrial refrigeration.

Mr. Wallace: I thank the Secretary of State for his very informative reply. Has any consideration been given to the possibility of imposing a requirement that the CFC package on refrigerators that are currently on sale should be detachable? Does his Department intend to give any financial assistance to local authorities to enable them to prepare and build disposal facilities for CFC elements that come from refrigerators?

Mr. Ridley: Recycling the coolant in the motors of refrigerators and the foam in their doors is very complex. It will probably be better to concentrate our efforts on producing substitutes, so that we may stop using these substances in the first place. But a lot of research is still going on; I do not think that we have yet come to a definite answer.

Harland and Wolff

The Secretary of State for Northern Ireland (Mr. Tom King): With permission, Mr Speaker, I wish to make a statement about Harland and Wolff. We announced in May 1988 that we were prepared to consider approaches from those interested in acquiring the yard. Since then a number of possibilities have been pursued. These have recently been narrowed down to two serious contenders, BT Shipping and a management-employee buy-out team led by Mr. John Parker, the current chairman of Harland and Wolff, and supported by Mr. Fred Olsen through two of his leading companies.
I can now advise the House that, having considered the proposals made by these two contenders, I have today approved, on behalf of the Government, heads of agreement for the sale of Harland and Wolff plc to Mr. Parker and his MEBO team, backed by Mr. Olsen.
The management-employee team and the Olsen companies will subscribe for £15 million of share capital to a new company. The company will then acquire the assets and the business undertaking of Harland and Wolff for approximately £6 million, net book value. The Government will advance to the new company £60 million of loan stock, on a repayment basis linked to performance.
Terms have been agreed under which the new owners will complete the single-well oil production system vessel for BP and the auxiliary oiler replenishment vessel for the Ministry of Defence. The Government will provide grant assistance of £38·75 million towards the cost of rationalising the activities of the yard—including new capital expenditure.
Under this agreement, Olsen companies will order three Suezmax tankers of about 150,000 tonnes each. I have agreed to offer intervention aid on them within the limits permitted by the European Community. The initial orders will provide work for the yard until the end of 1992.
The new company will therefore receive from the Government repayable loan stock and grant towards rationalisation of £98·75 million and intervention aid on new merchant orders.
Furthermore, to enable the company to raise performance guarantees necessary for the financing of its operations in its early years, the Olsen companies have agreed to make a recourse commitment for use by the new company to support predelivery ship financing. The Government will match this.
The existing liabilities will remain with the old company and the Government undertakings in respect of these liabilities of Harland and Wolff will not extend to the new company.
Beyond the terms of the heads of agreement, the Government will not provide any other special support to the new company except intervention aid and other grants normally available to other private sector companies in Northern Ireland. In this respect, I plan to repeal my powers in relation to the yard in public ownership contained in the Aircraft and Shipbuilding Industries (Northern Ireland) Order 1979.
The terms of the agreement are subject to contract and also a number of conditions including the approval of the European Commission, with which initial discussions have been held, and the agreement of the Norwegian authorities. Critically also, it depends on achieving the

support of Harland and Wolff employees. In particular, they will be invited to invest in the new company. To this end, a prospectus will be issued by the new company in the summer. Completion is planned for early September.
In respect of funding, provision was set aside in the Northern Ireland block for support to Harland and Wolff under present arrangements, and I hope to be able to cover the costs of disposal from within the block without any disruption of other Northern Ireland programmes.
I am pleased to make this announcement today which offers the hope of a much brighter future for Harland and Wolff. This famous yard has experienced a steady decline in employment over many years, and the chances of its survival were bleak. This proposed transfer to the private sector under a management and employee buy-out led by the present chairman, Mr. John Parker, and reinforced by the strength and well-established reputation of Mr. Fred Olsen and his companies, offers the chance of a new beginning and comes at a time when there are signs of an improvement in the shipbuilding market.
A lot of us have worked hard to try and make it possible for Harland and Wolff to have this new chance—none more so than Mr. John Parker, who deserves great credit for his unstinting efforts. The challenge now is whether he will get the support to bring it to reality. This is not the end of the challenge. This is just the beginning for all those in Harland and Wolff to show that they can succeed again in the tough and competitive world of shipbuilding. I believe that the management and employees at Harland and Wolff, together with Mr. Olsen and his colleagues, are ready to meet that challenge and we wish them well.

Mr. Jim Marshall: First of all, I thank the Secretary of State for making his announcement before Easter and at last putting an end to all the speculation about the future of Harland and Wolff. We all welcome the end of the uncertainty. However, it will come as no surprise to the Secretary of State that we believe that the Government's whole approach to the privatisation of Harland and Wolff has been handled in a particularly clumsy and insensitive manner, which has directly contributed to the low level of morale among the work force and to the loss of highly skilled staff, not just from Harland and Wolff, but from the economy of Northern Ireland as a whole.
Additionally, we feel that the decision that the Government made in the middle of last year to withhold intervention funding and their refusal to permit the existing company to tender for new orders seriously undermine the existing company's position and will make it that much more difficult for the new company to succeed.
Nevertheless, we recognise that, once the Government had made the decision to privatise—I repeat that my party deplores that decision and that we still continue to oppose that policy—they had a difficult choice to make between the rival bids. However, the Secretary of State will recall that, in our debate a few days ago, I made it clear that the official Opposition preferred, and always have preferred, a management-employee buy-out as we believe that it offers the prospect of greater security for the future of the company, especially in the longer term.
I should like to ask the Secretary of State some specific questions. He referred to preliminary discussions with the European Community. In those discussions, did he receive


any guarantee from the Commission that it would not block the financial arrangements being made for the privatisation?
As regards the short-term viability of the new company, does the Secretary of State recognise that there is a time lag of 18 to 19 weeks between when the orders for steel are made and when they are actually delivered at the yard? I am sure that he does. Therefore, will he, in the particular circumstances of Harland and Wolff, give permission for orders to be made now so that work may begin on the construction of the three Olsen tankers as quickly as possible in September? If permission is withheld until the new company comes into being in September, it will be at least the new year—January 1990—before any new steel work can begin on the Olsen tankers that will form the short-term basis for the viability of the new company.
Will the Secretary of State also give permission now for the company to tender for orders before the new company comes into existence in early September? Will he also seek to ensure that all the work force are involved in the discussions surrounding the buy-out, particularly in the light of today's press reports that a minority of the work force are apparently frustrated by the lack of information surrounding the buy-out? I am sure that the Secretary of State will agree that, if the venture is to succeed, it must have the full support of both the management and all the employees. We urge him to use his best endeavours to ensure that all the work force are fully involved in the discussions and the preliminaries leading up to the company.
Finally, may I also pay tribute to Mr. John Parker for his valiant work, both on behalf of the company and its employees to seek to ensure in the past—and I am sure, in the present—the viability of Harland and Wolff. I should also like to extend our thanks to the work force who, over the years, have seen the number of employees decline quite dramatically, but who still feel that there is a future for shipbuilding at Harland and Wolff in Belfast and who will support the new company with enthusiasm.

Mr. King: The hon. Gentleman's opening comments were absolutely incredible. He described as clumsy and insensitive the outcome of something which not many in the House would have dreamt was remotely possible—the successful privatisation of a shipyard which, under the Labour party's policy of nationalisation, was heading straight for closure. The hon. Gentleman can read the book and see that, when the yard went into public ownership it had 10,000 employees, now it has barely 3,000. Not many people would agree that that was a recipe for continued success.
The hon. Gentleman talked about insensitive handling. My hon. Friend the Minister responsible for industry had to take a lot of flak in Northern Ireland, while working extremely hard to guarantee the yard's successful future. Many people did not understand one of his most difficult problems, which was that if new commitments—new orders which might not have fitted the new strategy of the yard's potential owner—were made during the period of negotiation, they could well have frustrated any chance of privatisation.
I hope that the House will speak with one voice. This is a new beginning and a new oportunity for Harland and Wolff. Success is not guaranteed—many problems are still to be faced. There must he consultations with the work force. The hon. Gentleman, who has paid tribute to Mr.

John Parker, knows that that will he his task and, also, that Mr. Parker has sought to keep people informed of what he is trying to do. It is precisely because he has been able to put together a management-employee buy-out that we are here today, hoping to celebrate the launch of what we believe can be a successful undertaking.
There is as yet no guarantee from the European Community. We have held initial discussions that appear encouraging, but we cannot be certain about that until the final proposals can be put to the Commission. It will need to examine them and see whether they fit in with Community policy. We are hopeful that they will.

Several Hon. Members: rose——

Mr. Speaker: Order. I appreciate the importance of this statement, but we shall be dealing with the Water Bill, which is under a guillotine motion, and a ten-minute rule Bill today, so I ask for brief questions.

Mr. Peter Robinson: Will the Secretary of State accept that many of us have misgivings about privatisation, particularly in the shipbuilding industry, but that we have long recognised that this was not a matter of privatisation or public ownership—it was a matter of survival? In that context, not only those who live in east Belfast and work in the shipyard but the whole community in Northern Ireland will welcome the fact that the period of uncertainty has been brought to an end.
Will the right hon. Gentleman take it from me that a large section of the work force feel that they do not know enough about the detail of the management-employee buy-out, and that it is now essential that the details are made clear to them and the proposal is sold to them? Will he help Mr. Parker to sell the proposal to the work force and tell us whether he is satisfied that the dowry that has been handed to Harland and Wolff is large enough to capitalise the firm in the early stages of its growth?
Is the right hon. Gentleman satisfied that there will be easy and immediate access to MOD orders and to intervention funding, not just for the three ships for which orders have already been received, but for further orders? I join in the Secretary of State's tribute to Mr. Parker, and I pay tribute, too, to the management team and the work force in Harland and Wolff, who have acted responsibly during the protracted period of negotiation.

Mr. King: I certainly recognise that this has been a period of acute worry for the work force and all involved in Harland and Wolff. One would have hoped that the period could have been shorter, but I think I am correct in saying that it is only seven weeks since Mr. Olsen showed his interest in being involved. If the House understands the complexity of heads of agreement and all the other matters that have to be covered, it will agree that that is a remarkable tribute to my officials who have worked on the agreement—officials do not always receive praise in this House. I hope that the hon. Member for Belfast, East (Mr. Robinson) will recognise the work that they have clone together with the management of Harland and Wolff under Mr. Parker's leadership, and that he will recognise the contribution of Mr. Fred Olsen and of Mr. John Wallace and his colleagues in the Olsen group of companies in bringing this to an effective conclusion.
The hon. Member chooses not to distinguish between privatisation and nationalisation, and says that he does not want to argue about them—he is interested in survival.
Under nationalisation and public ownership the yard was headed in one direction—extinction. Its hope of survival and expansion stems from the fact that it now has the possibility of private sector involvement. The personal commitment of management and employees is hugely important, but so is the personal commitment of a well-respected outside shipbuilder.

Mr. James Molyneaux: Is the Secretary of State aware that there will be general satisfaction at this promising outcome? Does he agree that the commitment of Mr. Parker and the management and work force is a welcome development, and that the involvement of an industrialist of the international standing of Mr. Olsen will bring great confidence and a boost to industry throughout Northern Ireland?
All three political parties representing Northern Ireland wish to express appreciation of the personal efforts of the Secretary of State and of the painstaking trouble he took at all stages of the delicate negotiations. I include in that appreciation the Parliamentary Under-Secretary of State, the hon. Member for Gosport (Mr. Viggers).
It would be only right for me to say that I hope that the task of the Secretary of State was made a little easier by the joint approach of the three political parties which represent Northern Ireland in this House. It would be churlish if I were to omit the part played by SDLP colleagues in those meetings and negotiations. Will the Secretary of State convey our appreciation of the central role played by the Prime Minister and assure her that we, the elected representatives, will fully honour the understandings that were reached when we met her on 23 February—I choose my words carefully—and will do all in our power to assist the management and the work force to make a success of the commitment into which they have now entered?

Mr. King: I am very grateful to the right hon. Gentleman. I appreciate his kind words about whatever part I have been able to play and particularly his kind words about the Under-Secretary of State, my hon. Friend the Member for Gosport (Mr. Viggers), who has had to take a lot of flak over this, as the right hon. Gentleman is aware, but has stuck to his guns. I congratulate my hon. Friend on that.
I also appreciate the right hon. Gentleman's comments about the discussions that we were able to have, and those with my right hon. Friend the Prime Minister. There is no doubt that coming together in that way was helpful. I hope that the lessons can be learned of the value of co-operation in areas where there is value in such co-operation. Northern Ireland speaking with one voice was a much more encouraging sign than some of the noises that we hear from time to time.
The important word which the right hon. Gentleman used was "promising". That is right, because this is not a signed, completed contract. This is the beginning of the challenge in which we all have a part to play; I include the hon. Member for Belfast, East in that, although I did not acknowledge that in my comments to him. We all have a part to play and I hope that we can ensure that this promising start reaches a successful conclusion.

Mr. Kenneth Warren: I am delighted that my right hon. Friend the Secretary of State

has endorsed the goodwill and trust of the Select Committee on Trade and Industry which reported to the House on Harland and Wolff, and also endorsed the confidence of the work force. I trust that the work force will respond, because it exhibits a very high degree of technical quality. While we wish Mr. John Parker and his team and Mr. Olsen every success, will my right hon. Friend assure us that the Government will, without hesitation, make it clear to the Commission in Brussels that we expect its endorsement for the venture without delay? Harland and Wolff has the biggest and best shipyard in western Europe and we must ensure that it is maintained as a national and European asset.

Mr. King: I am grateful to my hon. Friend. Having sat before him and answered his questions, I am well aware of his interest in this matter. I am also grateful for the interest shown by the Select Committee on Trade and Industry. There was nothing between us about the fact that the Harland and Wolff shipyard is a major asset. The yard is important; It is on a larger scale than other yards in western Europe in general and its work force has considerable technical skills. The arrangement that I have announced today, if carried forward successfully, offers the possibility for those facilities to be put to the best possible use. I am grateful for my hon. Friend's comments. I assure him that I have tried to ensure that the right messages have been lodged in Brussels and we will carry that forward as soon as we can.

Mr. Paddy Ashdown: Whatever the delays and ideological road blocks created by the Government before an easier and earlier solution, the Secretary of State has made a very happy announcement today. I congratulate him on choosing the management-employee buy-out and on the work that he and his colleagues have done. He was right to pick out John Parker, whose commitment to Northern Ireland and to Harland and Wolff is very much a part of the deal. He was also right to pick out Mr. Fred Olsen, whose commitment to the deal will be observed from outside with some interest. Do they not both comprise a vote of confidence in the staff, and especially the work force?
I believe that the Secretary of State said that the support of the work force was "critical". Does he mean that it will be conducted on the basis of a vote, or does he mean that the commitment of the work force's money to the proposal in some proportion or another will be an essential part of the deal? If the latter, I ask the Secretary of State to bear in mind especially that the special circumstances of Northern Ireland, and the uncertainty which has hung over Harland and Wolff, may well mean that many members of the work force, for reasons that he will understand, will not feel able to commit in large amounts what in essence will be their redundancy packages. I hope that that will not cause the deal to founder.

Mr. King: The heads of agreement that we reached today relate to a management-employee buy-out, which was planned by Mr. Parker and discussed by the management and employees of Harland and Wolff as a way of saving the yard and giving it the best possible chance for the future. When speaking of the support of the employees, that is very much what I have in mind.
The right hon. Gentleman rightly picked up on the terms of the agreement, paraphrased though they were,


and he referred to the word "critical"—but my use of that word goes wider. Harland and Wolff has an opportunity that it will not achieve under its present methods of operation. If the yard is to succeed, there must be changes, recognition of the need for new methods and new approaches, and new commercial vigilance and determina-tion. That is also what I meant by the support of the work force being critical. Mr. Parker can give the lead, but it is critically important that people are prepared to back him.
I am grateful for the right hon. Gentleman's support, and for the general support of hon. Members in all parts of the House for Mr. Parker and his colleagues. The Government will back them too, and I hope that all those in Harland and Wolff, who may have been used to a rather different working situation and atmosphere under public ownership, will realise that there is a new situation, and one in which they have their part to play.

Mr. James Kitfedder: Will the Secretary of State convey the thanks of the people whom I represent to the Prime Minister for her helpful and influential intervention, and for her approval of the finance enabling the deal to go ahead? Will the Secretary of State tell the House which factors made him decide to opt for the management-employee deal as opposed to the Eddie Pollock deal, and how much less it would have cost the taxpayer if the Pollock deal had been approved?

Mr. King: I am grateful to the hon. Gentleman for giving me the opportunity to explain that, in the final analysis, we had before us two strong contenders. I appreciate very much the interest of Mr. Eddie Pollock and his team and the care they took in making their proposals. My final judgment was that, on balance, on the evidence available to me, and because certain aspects of BT Shipping's proposals were not as clear and as final as I would have wished, that the accepted proposal offered the best prospects for the yard's continuing and enhanced success in the future. One of the factors that also influenced me was the need, as has been mentioned already, to reach a decision as early as possible. I could not afford to wait longer for further clarification of proposals that might not have been successful. I regarded the MEBO-Olsen proposal as a serious proposal, and as the one that I should recommend.

Rev. Martin Smyth: With other right hon. and hon. Members representing Belfast constituen-cies, I welcome the statement. As I said on a previous occasion in the House, that is good news not only for Belfast and Northern Ireland but for the whole United Kingdom economy, because it will have a knock-on effect. Will the Secretary of State use his influence with the Secretary of State for Defence to ensure that the shipyard will not be limited only to merchant shipping contracts but can tender for defence contracts as well?
I join others in calling upon the work force at Harland's to do what it has in the past. When others said that things could not be done, it did them. It built both the Titanic, which somebody else sunk, and the Sea Quest, which some people conveniently forget about. When Japanese firms said that ship could not be built, Harland's built it. The company has now been given a new opportunity, which I welcome.

Mr. King: If I was looking for an illustration of what Harland and Wolff can do when asked, it would be its

support in meeting the urgent requirements for the Falklands campaign, which is an even more recent example than that mentioned by the hon. Gentleman. As to Ministry of Defence orders—I apologise for not answering this question when it was put earlier by the hon. Member for Belfast, East—it is our intention that the yard will be able to tender for them. I am not sure how many orders there are around at the moment, but it is certainly our intention that the yard will be able to do that.

Sir Giles Shaw: Will my right hon. Friend accept my congratulations to him and to the Under-Secretary of State on finding an imaginative solution which eluded many of his predecessors, including me? What did he mean by the liabilities that remain in the old company? Was he referring to the accumulated debt in capital and interest? If so, how will that be dealt with under the terms of the competition policy of the European Commission?

Mr. King: I am grateful for my hon. Friend's gracious comments. The sentence he will have noticed, which points out the difference and shows why it was possible to make the announcement today, states that there is expected to be an improvement in the shipbuilding industry. That has led to greater confidence and made it possible to consider proceeding in this way, and it accounts for the considerable private sector interest in the company.

Mr. Bob Clay: Why are the Government closing other yards, then?

Mr. King: My hon. Friend is correct that the accumulated debts will remain and are likely to have to be written off. There are also certain rather smaller ship financing liabilities connected with orders for previous ships for which the old company, retains responsibility.

Mr. Doug Hoyle: Will the Secretary of State note that, while we would have preferred the company to have remained in public ownership, we welcome his Easter present to the people of Northern Ireland in bringing the uncertainty to an end so soon after the report of the Select Committee on Trade and Industry? Will he clarify his announcement a little further? Will the company be able to accept new orders and tender for Ministry orders from now on, without waiting for the new company to be brought into existence? Finally, I do not want to end on a sour note, but does the Secretary of State envisage that the labour force will remain stable until the new company is established and that there will be no further redundancies?

Mr. King: On the last point, some redundancies have been announced and it is likely that they will need to go ahead, but it will then be a matter for Mr. Parker, who will be able to advise further how he sees the situation developing. The hon. Gentleman spoke about the company taking new orders. That is a complicated matter. I said that I hoped that the transitional period would be completed by September. During that time, a prospectus will be prepared and details will be put before the work force to establish whether the various details can be tied down into a final contract.
The complexity of, and one of the difficulties in negotiating, those heads of agreement is deciding what to do about existing contracts and who takes liability for what in regard to the SWOPS and the AOR being built at


the moment. There will need to be further discussions about other orders. Under the proposals, the first orders likely to be in the yard will be the three orders which are part of commitment to Mr. Olsen for three Suezmax tankers.

Mr. Robin Maxwell-Hyslop: May I congratulate my right hon. Friend on an achievement which meets the wishes of the employees as they stressed to us when we took evidence there that it was their wish that the management buy-out in league with them should succeed? He may also be interested to learn that, when the Select Committee on Trade and Industry was over in Brussels recently, we stressed the need for a quick decision should this happy situation arise and we were certainly led to believe that they were well aware of the desirability of the quickest possible response to the application for approval from Her Majesty's Government.

Mr. King: I know the interest that my hon. Friend has taken in the matter, and I am grateful to him for lending his powerful voice to the pressures which others are trying to apply to the Commission in the hope that we may receive an early response. I hope that he felt that the responses he received were not discouraging. I thank my hon. Friend for what he said about that achievement. Two or three years ago, not many people would have had much hope that Harland and Wolff could conceivably be privatised, yet under nationalisation it could never have had the direct personal involvement and commitment of a major figure within the shipbuilding and shipping industry who can contribute his resources and connections, which, as Mr. John Parker would be the first to say, bring a major additional strength to the new consortium.

Mr. Ken Maginnis: Will the Secretary of State accept that, while we are all delighted with the decision that he has announced, much work needs to be done especially in Belfast, by the Northern Ireland Office—his team of Ministers and himself—in the wake of this decision? Will he acknowledge that the uncertainty that the Government have displayed —I do not wish to enter into recriminations—over almost the past year had led to a drop of morale in the yard and instability on the streets of Belfast?
In the new spirit we have seen today, will the right hon. Gentleman pursue his decision to its ultimate conclusion as quickly as possible, reassuring not only those in the yard but those who live in Belfast about the Government's intention to create new stability in Northern Ireland? I encourage him to speak to his right hon. Friend the Secretary of State for Defence to ensure that, as soon as possible, the opportunity is accorded to Harland and Wolff to bid for a Ministry of Defence order.

Mr. King: I reject completely the allegation and suggestion of uncertainty. We have been determined to achieve the privatisation of Harland and Wolff—a project that many would have thought quite impossible and without which the yard would have been condemned to certain closure. We have succeeded, but it has not been easy and there have been many problems along the way. Unfortunately, they arose against a background of great

and instrusive interest in publicity, reporting and comments made by individuals from different sides, which made the task all the more difficult.
We must recognize how difficult that task was. It looks as though it has been successfully accomplished. I am glad that, far from showing uncertainty, we stuck resolutely to the path on which we had embarked, which we believe has been brough to a successful conclusion.

Several Hon. Members: rose——

Mr. Speaker: Order. I have called all hon. Members who are directly involved in the statement. I recognise that other hon. Members have an interest, but I ask for brief questions.

Mr. Ian Gow: Is my right hon. Friend aware that the tribute he paid to Mr. John Parker and those who work at Harland and Wolff is well deserved? Is he further aware that the confidence that he expressed in them is shared by all Conservative Members? As my right hon. Friend is a party to the heads of agreement, will he do his utmost to convert them into an actual agreement at the earliest possible date?

Mr. King: I know that my hon. Friend's tribute to Mr. Parker and his team and to Mr. Olsen and his colleagues will be much appreciated, and is well deserved. I assure my hon. Friend that I wish this further stage to be brought to a successful conclusion at the earliest possible opportunity so that we can advance, and the question of the yard taking further orders from other sources can be considered. People understand that, if we can carry this proposal through, the intended direction for the yard must become a possibility, given the assets it has. I give an unqualified yes to my hon. Friend's question.

Mr. Bob Clay: I welcome the potential salvation of any shipyard and believe that the skill, ingenuity and determination of Mr. John Parker, far more than the policies of the Government, may save Harland and Wolff. Before the Secretary of State made the statement, did he have discussions with his ministerial colleagues in the Department of Trade and Industry about how he would square the level of support, state aid and writing-off of debt for Harland and Wolff with the pathetic conditions made available to North East Shipbuilders Ltd. before it closed? Will the right hon. Gentleman explain why he is so optimistic that the proposal will be accepted by the European Commission, when we were continually told by the Department of Trade and Industry that much more modest proposals for shipbuilders in Sunderland and other shipbuilders' subsidiaries on the mainland would not be acceptable to it?
Can the Secretary of State explain why, as he has already said today that possibly the greatest reason why Harland and Wolff may survive is that there is now an upturn in the shipbuilding market, his colleagues at the Department of Trade and Industry have been denying that for a long time and have been closing other shipyards? How can the Secretary of State square all this within one Government?

Mr. King: Of course, other Departments are aware of my proposals today. I understand the hon. Gentleman's disappointment about the problems at North East Shipbuilders Limited and we all share that. It was not possible to find a viable future in any of the offers put


forward. I am sure that the hon. Gentleman is not in the business of seeking to denigrate other yards and employees. The Harland and Wolff yard has assets that NESL, sadly, does not have. Harland and Wolff has the capacity to build the size of ship that NESL cannot build. Harland and Wolff will have the involvement of an outside investor who is well respected within the shipbuilding and shipping industry. I am not sure whether such an investor was available to NESL.
The test that we had to apply was whether the proposal offered a viable prospect for the future of the yard and for the enduring future of shipbuilding. My right hon. Friend the Chancellor of the Duchy of Lancaster had to speak at the Dispatch Box about NESL. Sadly, the Government were not able to see such a long-term, viable future in the proposals put before them then. The proposals I have announced today have such viability.

Mr. Peter Thurnham: Will my right hon. Friend accept that the only criticism of this excellent decision is that it was not possible to make it many years ago? Even the designer Socialists in the Opposition seem to recognise that people now want the spirit of enterprise, not the old, decayed decadence and dogma of clause 4, which some Opposition Members still seem to want?

Mr. King: I am grateful to my hon. Friend for his comments. He is right. The involvement of Mr. Olsen and his colleagues, together with the contribution of Mr. Parker and the commitment and enthusiasm of the people working at Harland and Wolff, are a combination that could be an exciting prospect.

Mr. Nicholas Brown: The Secretary of State seems confident that Harland and Wolff will be able to compete for Ministry of Defence work. At the time of the AOR1 contract, the Prime Minister and the Secretary of State for Defence gave the House clear assurances about that order and about public subsidy. Can the Secretary of State tell us today that there will still he no element of public subsidy for the AOR1 order, that the vessel is still being built to cost and that it will arrive on time? Can he tell us that that is the basis on which he expects Harland and Wolff to be able to compete for Ministry of Defence work and that the Government have not reneged on the promises given to the House three years ago?

Mr. King: I am surprised that the hon. Gentleman makes that comment as he speaks for a constituency that has been entrusted with the AOR 2, precisely because the undertakings that I gave from the Dispatch Box have been honoured. His comment was pretty churlish and snide.

Mr. Henry Bellingham: I also want to congratulate my right hon. Friend and my hon. Friend the Under-Secretary of State for Northern Ireland, the Member for Gosport (Mr. Viggers), on their imagination and skill in putting together the deal. However, can my right hon. Friend say whether there will be any preferential scheme for lower-paid employees to be able to buy shares? It is imperative that as many as possible are brought in as shareholders and owners of the new company.

Mr. King: I would rather that this matter was put before the employees by Mr. John Parker. He has constructed his proposals and has discussed with senior management, management and employees his ideas for the way in which they could contribute. I would rather leave that to him.

Dr. Norman A. Godman: The importance of this yard extends far beyond the Province, and the announcement made this afternoon could have an important bearing on my constituency with regard to the Norwegian connection and the orders for the three new tankers to be built with shipbuilding intervention fund money. May I remind the Secretary of State that when the Norwegian firm Kvaerner Industries acquired Govan shipyard, part of the deal was that it would place orders for new engines with Clark Kincaid of Greenock? Surely the Secretary of State should be advising the new owners of the Ulster yard that shipbuilding intervention fund money must be used to acquire purchases from suppliers within the United Kingdom? He and all hon. Members will surely forgive me when I say that orders for the engines for the three new vessels should be placed with a Scottish firm—namely, Clark Kincaid.

Mr. King: I can understand the hon. Gentleman putting in a bid on the part of his constituents, but he knows very well that Clark Kincaid and Govan shipyard were part of British Shipbuilders, and the arrangement was part of British Shipbuilders' understanding over the transfer of Govan to Kvaerner. Obviously, the continuance and possible expansion of Harland and Wolff, if it is successful in the future, is good news not just in Northern Ireland but in other parts of the United Kingdom. It must be very good news for British Steel if the corporation is competitive, because three Suezmax tankers will take a lot of steel. If the yard had not continued to operate, that steel would not have been bought. That is part of the spin-off effect of the proposals. I am sure that Mr. John Parker and his colleagues will view sympathetically any competitive offers from firms in the hon. Gentleman's constituency, as we would all like as much as possible to be procured in the United Kingdom.

Mr. Dave Nellist: What guarantees of job security up to and beyond 1992 did the Government get from Mr. Parker, given the Secretary of State's initial remarks about further rationalisation costs? What exactly does that rationalisation entail? Secondly, given about half a billion pounds, worth of debt cancellation and the subsidies announced by the Secretary of State today, why do not the Government put money into Harland and Wolff to allow the company to flourish and prosper in public ownership, instead of putting money in to allow private shareholders such as Mr. Olsen to reap the benefits?

Mr. King: The hon. Gentleman's economic brilliance seems to have deserted him for once. If there are accumulated debts, there is no money to put in; that money has already been lost over the years. It is a question not of putting new money in but of writing off money that has already been lost.

British Nationality (Honorary Citizenship)

Mr. David Amess: I beg to move,
That leave be given to bring in a Bill to provide for the award of honorary British Nationality to any individual for outstanding humanitarian services in Hungary during the period July 194–4 to January 1945.
At the outset, let me say that the intention of the Bill is that honorary British citizenship should be awarded to Raoul Wallenberg. Early-day motion 234 encapsulates the spirit of the Bill, and I am grateful to those hon. Members on both sides of the House who have signed it, thus showing their support for the measure.
I wish to record my thanks to those who have assisted me in preparing the Bill. They include United States Congressmen Ted Weiss and Tom Lantos, Mrs. Rachel Haspel of the Raoul Wallenberg Committee of the United States, the Jubilee Campaign, Miss Louise Smith and Mr. Paul Lennon.
I shall first address the work of Raoul Wallenberg in Budapest in those incredible closing months of world war 2; then I shall explain why I think that honorary British citizenship should be awarded.
More than 100,000 men, women and children undoubtedly owe their lives to Raoul Wallenberg. Although the great majority of them were Jewish, the record shows that Catholics in Budapest were also persecuted and that Wallenberg protected them. Raoul, who has rightly been called "the righteous gentile" did not stop to inquire about religion; he saved all he could, regardless of faith.
When Wallenberg arrived in Budapest on 9 July 1944, newly appointed to the Swedish legation, he immediately went into action. He arrived dressed in a windbreaker, carrying a rucksack, a sleeping bag and a revolver. The latter, he said, was merely to give him courage; he never used it. He immediately began to issue certificates for the Jewish people who already had visas for Sweden. He invented, on the spot, a procedure that was subsequently the saviour of thousands of people—the Schutpass or protective passport. That consisted of an official-looking document with the Swedish colours, the Swedish coat of arms and the ambassador's signature—all the formality necessary to impress the Germans.
Wallenberg negotiated with the Germans for permission to distribute 5,000 of those passports. Instead he printed and distributed thousands more than the original limit. He rented houses, protected them under the flag of Sweden, and sheltered as many persons as he could. Those houses held about 20,000 people. Wallenberg encouraged other embassies to follow that example, bringing the number rescued in that way to 50,000 people.
Wallenberg was untiring and relentless in his efforts, repeatedly risking his own life. The Germans made several attempts to kill him. He knew the danger, but he would not withdraw. He had authority, diplomatic status and undaunted courage, and he intimidated the Nazis by his mere appearance.
Almost daily, Wallenberg went to the railway stations in Budapest where Jewish people were on their way to Auschwitz in cattle cars with the doors nailed shut. He commanded the doors to be opened as he looked for people with Swedish passports. He would take people who had a driver's licence, a library card, a receipt or any piece of paper written in Hungarian, which the Nazis could not

read. He marched away with 100 people here and 100 there, in front of the Nazi guards. The same story was repeated in the death marches to the Austrian border.
Wallenberg's greatest skill was in negotiating with the Germans. At one time the Hungarian Nazis—the so-called Arrow Cross—in their desperation decided to exterminate the general ghetto. People had been herded into the area and put into star-marked houses as a last stop before Auschwitz. Families were separated and no food or clothing was provided. People were at a level of exhaustion and despair. As the Soviets closed in on the city, the Nazis decided to blow up the ghetto. Wallenberg heard of the plan. He confronted the Nazi leaders and told them that he personally would see them hanged as war criminals if they proceeded with their outrageous action. The plan was stopped, thus sparing an estimated further 70,000 lives.
Wallenberg was only 32 years old. He was viewed by Hungarian Jewry as a saviour—a white light in a horrible darkness. In those nightmarish days, he was already a legend. The fact that he existed was passed among the Jews in whispers through the streets of Budapest.
After the Russians took Budapest in January 1945, Wallenberg mysteriously disappeared. The Russians said that they had taken him into protective custody. Then a curtain of silence fell on his fate. Efforts to obtain his release, or any information about him, have been ignored by the Russians. Andrei Gromyko informed the Swedish Government in 1957 that Wallenberg had died of a heart attack 10 years earlier in a Soviet prison. He would have been only 36 years old. No prison records have ever been produced. However, over the years, continued reports from former prisoners of the Gulag, independently and without knowledge of each other, have consistently testified to the fact that he was still alive in the Soviet prison system.
The flagrant disregard by the Soviets of Wallenberg's diplomatic status—in violation of international law—is a fact that cannot and should not be ignored. Whether he is alive or dead is, of course, of utmost importance, but that has no direct relevance to the decision to bestow upon him honorary British citizenship. Bestowing honorary citizen-ship is not only the greatest recognition that we could give Raoul Wallenberg, but the action would be our most appropriate. Raoul Wallenberg was not the head of state of a great Government. This act is not a self-interested national investment in future political alliances. This man's life shows the heroism, willing self-sacrifice and dedication to a cause that is unparalleled in our time. He has illuminated our history.
We need to take this unprecedented action to let the Russians and the world know that in a civilised society the violation of international law and human rights will never be ignored, that we do not forget and that Raoul Wallenberg will not be abandoned by Britain.
It would be fitting and appropriate if, on 9 July 1989 —45 years to the day after he began his mission in Budapest—we could announce that Raoul Wallenberg is, from that day forward, an honorary citizen of Great Britain.
Undoubtedly Raoul Wallenberg is deserving of limitless praise for his selfless and courageous action. Unlike many others who preferred to remain indifferent in the face of the unspeakable horrors of the holocaust, Raoul Wallenberg refused to ignore the perverted evil of the Nazi regime. He acted; we can do no less on his behalf.
I commend the Bill to the House.

Question put and agreed to.

Bill ordered to be brought in by Mr. David Amess, Ms. Diane Abbott, Mr. David Alton, Mr. Peter Archer, Mr. David Atkinson, Mrs. Rosie Barnes, Mr. Alistair Burt, Mr. Cecil Franks, Mr. Ken Hargreaves, Mr. Greville Janner, Mr. Ivan Lawrence and Mr. Rhodri Morgan.

BRITISH NATIONALITY (HONORARY CITIZENSHIP)

Mr. David Amess accordingly presented a Bill to provide for the award of honorary British Nationality to any individual for outstanding humanitarian services in Hungary during the period July 1944 to January 1945: And the same was read the First time; and ordered to be read a Second time upon Friday 12 May and to be printed. [Bill 108.]

Orders of the Day — Water Bill

2ND ALLOTIED DAY

As amended (in the Standing Committee), further considered.

Clause 7

GENERAL ENVIRONMENTAL AND RECREATIONAL DUTIES

Mrs. Ann Taylor: I beg to move amendment No. 115, in page 7, line 23, at end insert—'
or relating to any land to which this section applies'.

Mr. Deputy Speaker (Sir Paul Dean): With this it will be convenient to discuss the following amendments:
No. 116, in page 7, line 41, at end insert—
`or relating to any land to which this section applies'.
No. 110, in page 7, line 42, leave out paragraph (a) and insert—
`(aa) to preserve and maintain public rights of access to areas of woodland, mountain, moor, heath, down, cliff, water areas including reservoirs, or foreshore and other places of natural beauty.'.
No. 117, in page 8, line 17, leave out 'and'.
No. 118, in page 8, line 18, at end insert—
`or of any other land to which this section applies'.
No. 121, in page 8, line 24, at end insert—
'with the exception of access on foot by the public to the land'.
No. 119, in page 8, line 26, at end insert—
'(6A) This section applies to any land which was owned before the transfer date by a water authority.'.

Mrs. Taylor: The amendments open up an important area of the Bill and I hope that we shall be able to make some progress in our discussions.
The amendments are to clause 7, which relates to:
General environmental and recreational duties
and which has caused concern to hon. Members on both sides of the House. We all acknowledge that it is important to get this part of the Bill right. When we discussed this matter in Committee, the Minister for Water and Planning gave us many assurances and said that we were worrying unduly about the restrictions on access that might come about as a result of the Bill. He told us that all was well and that there was no need for us to worry. He did not convince us then and he did not completely convince himself, because since our discussions in Committee—not that long ago—the hon. and learned Gentleman has reconsidered the issue.
I do not want to anticipate later debates, but we welcome the Minister's change of heart, as shown by some of the amendments that he is introducing, particularly Government amendment No. 57 on the rights to roam. We raised that issue in Committee and he told us not to worry, but I am glad that he has accepted that there were problems with the Bill as originally drafted.

The Minister for Water and Planning (Mr. Michael Howard): I am sure that the hon. Lady will recall that during our discussions of these matters in Committee I said that I would keep an open mind and would listen to the argument and that if I was persuaded by the argument I would act accordingly.

Mrs. Taylor: I repeat that I welcome the Minister's amendments. I hope that we shall be able to persuade him to go a little further and that he will be able to reassure us about some of our other concerns about access.
Three main problems still exist with clause 7. The first concerns the weakness of the phraseology in the Bill, in particular the phrase
have regard to the desirability of
in clause 7. We are still convinced that that phrase does not afford proper protection for the recreational rights now enjoyed by many people.
4.30 pm
The second problem is the need to discover to whom the duties in the clause apply. Will successor companies be included? Amendment No. 119 is aimed at ensuring that the successor companies and any subsidiaries of the new privatised water companies are caught under the obligations that the Bill imposes on water undertakings. The third problem is about charging. Amendment No. 121 deals with that problem and with the pressure on new owners of land to introduce charges even for access on foot:
When we discussed these issues in Committee, it was pointed out that the Water Act 1973 put duties on all water authorities and on statutory water companies to make their land available for recreation. Since then some progress has been made; many water authorities have opened up more of their land to the public. Conflicts still arise in some places. For example, the Yorkshire water authority sometimes gives priority to grouse shooters rather than to ramblers. But in general the situation since 1973 has improved and it has been easier to persuade water authorities to open up some of their land.
We pay tribute to those who piloted that measure through the House, including the present Secretary of State for Wales. It is ironic that another Conservative Secretary of State should be sweeping aside that measure, which has worked over the years in the public interest.
The Bill contains two main recreational duties. The first appears in clause 7(2), which states that every relevant body must
have regard to the desirability of preserving public rights of access to areas of woodland, mountains, moor, heath, down, cliff or foreshore and other places of natural beauty".
When the matter was debated in Committee on 31 January, we interpreted the phrase "public rights of access" to mean just that. But the Minister said that it was wrong for us to conclude that "public rights of access" meant public rights of access, and he said that a wider interpretation covering concessionary routes was necessary or the provision would be an absurdity.
We agreed with the Minister; unless "public rights of access" meant more than simply rights of access, the duty to protect those areas would be meaningless because public rights of access already exist in law and are not in need of special protection. There is agreement on that, it seems.
We are pleased that the Secretary of State has tabled an amendment to end that absurdity. We welcome his move to extend the provision, even though it gives only nominal protection, with the change from "rights of access" to "freedom of access". However, that will be meaningful only if the whole clause has bite and strength. Unfortunately, clause 7 does not have any bite because the duty imposed is only
to have regard to the desirability of

preserving for the public any freedom of access. That means that nobody need do more than simply think about whether something is desirable. If the new profit-seeking companies decide that the preservation of access is not desirable or that it in some way conflicts with their enterprise activities, the duty will be meaningless.
The second main recreational duty is to be found in clause 7(3). Under the 1973 Act, public bodies managing land owned by the public were told to do what they could to open up their land to the public. Now, what appears to be a similar duty is being placed on the new private water companies.
It is important to remember, however, that private companies are answerable not to the public but to their shareholders. Their priorities will not be those of a public authority. Clause 7(3) states that the National Rivers Authority, water and sewage undertakers and internal drainage boards have a duty
to take such steps as are—

(a) reasonably practicable; and
(b) consistent with the purposes of the enactments relating to the functions of that body,

for securing, so long as that body has rights to the use of water or land associated with water, that those rights are exercised so as to ensure that the water or land is made available for recreational purposes and is so made available in the best manner.
Those bodies do not have to open up their land if they consider that it is not reasonably practicable or if they think that it is not consistent with the purposes of the enactments relating to their other functions. We accept that there will have to be operational restrictions and that some will be justified in some uses of some of the land. That is bound to be a small proportion of the land, but there will be nothing that the public can do to ensure that these bodies open up the remainder of their land, whereas under the present system the public can publicly press a public body to open up public land to the public, as is right. The ability to pressurise and to make sure that land is opened up will be reduced in future.
There is an important intrinsic difference between a public landowner and a private landowner. While public landowners do not have a perfect record, they have a far better record than private landowners. We have only to consider the record of the statutory water companies, who were under the same obligation under the 1973 Act, to see that they have not opened up their land in the same way that water authorities did in the past. Therefore, we think that the recreational duties are very weak, and we hope that the Minister will accept our point that they should be strengthened.
That brings me to the second question. To whom do these duties apply? Who, exactly, will have to have regard to the desirability of protecting for the public any freedom of access? That is the main point of disagreement between the two sides of the House. I do not think that we disagree on our objective but only on how to achieve it.
In Committee the Minister stated that the extent to which land could be disposed of free of the duties imposed by clause 7 would be severely limited. That conflicts with the advice and the information given in a letter on 4 January from the Department of the Environment to the chairman of Thames regional recreation and conservation consultative committee, which said:
These statutory duties will only apply to the plc core business since it would be impossible to justify a blanket extension to subsidiary companies.


That worried my hon. Friends and many organisations outside the House. The Ramblers Association, the Open Spaces Society, the British Mountaineering Council and the Youth Hostels Association were so convinced that the Minister was making incorrect statements to the Standing Committee, and that he was misinterpreting the Bill, that they clubbed together and paid for counsel's opinion out of their meagre resources to clarify the legal position. Counsel's opinion stated clearly that the Minister's statement in Committee was wrong. Counsel went on to say—I am sure that the junior Minister has seen this opinion; I know that the Minister of State has—
The Minister turns out to be wrong to say that it is not possible, merely by disposing of ownership, to free the use of land from the clause 7 duty.
The opinion goes on:
The Minister speaks as if the clause 7 duty attaches to the land when in reality it does nothing of the sort.
The basic question remains: do the clause 7 recreational duties apply to the land no matter who owns it, or do they apply only to the limited list of relevant bodies defined in the Bill? That is the core of the discussion on this clause.
The purpose of amendment 119 is to ensure that all the duties in the Bill apply to subsidiary bodies. I hope that the Minister will accept that point, because water authorities that are gearing up for privatisation are acting as if the duties will not apply to all the land. I look, for example, to the Yorkshire water authority, which has announced its post-privatisation structure. It intends to split its activities into three divisions, only one of which will be the water undertaker as licensed by the Secretary of State. If the land is owned by either the main holding company or the enterprise division that Yorkshire Water is establishing, which will have a duty to make a profit, that land will escape completely the recreational duties provided for in the Bill. The Minister tells us that the Bill will achieve something that we want it to achieve, but the very clear legal opinion is that it will not.
In a letter of 6 February to Members of Parliament, the Under-Secretary, who will be replying, has made his position clear. I hope that he will accept that amendment No. 119 fulfils the obligations which, in that letter, he spelt out as being necessary. Our amendments make it very clear that clause 7 should be extended so that its provisions will apply to any land owned by the water authority before the transfer date, I hope very much that the Minister will accept that point.
Finally, I want to say a few words about charging, which is the subject of amendment No. 121. Clause 7(5) clearly enables the new owners to introduce charges for public access to open spaces. It says:
Nothing in this section or the following provisions of this Act shall require recreational facilities made available by a relevant body to be made available free of charge.
The Under-Secretary of State, in his letter, said that he saw no reason to believe that, in practice, access would be made subject to considerations of competition and profit. He said that he found it difficult to envisage circumstances in which the companies would find it sensible or cost-effective to make charges.
However, it is obvious to all of us that, once these private companies are established, their main priority will be to maximise their profits, and they will be under considerable pressure to do so. Therefore, charges will be introduced, and they will be set at a very high level—or at the highest level possible in accordance with the workings of those companies. Obviously, charges cannot be

introduced for walking where there are rights of way, or for walking over land where there is a right of access. But most public access to water authority land is not as of right. That is the nub of the debate. In the majority of cases, access is enjoyed only by the permission of the water authority, and it is that access which is under threat and for which charges might be introduced after privatisation.
If the Government have no intention of allowing or encouraging charges to be introduced for rambling I see no reason why they cannot support our amendment No. 121, which states that if charges are to be made for recreation, they should be made
with the exception of access on foot by the public to the land".
We are talking about large areas of land in areas of outstanding natural beauty which are enjoyed by the public who own it and who have rights of access that have been granted on a concessionary basis by the water authorities. That access is seriously threatened both by the provisions in the Bill which could deny any access and by those that could allow charging.
The new water companies will be operating under considerable pressure to maximise their profits. The access that we have all enjoyed for so long could become a thing of the past if the Bill is enacted unamended. I therefore hope that the Minister and the House will accept our amendments.

Mr. Gordon Oakes: I wish to support my hon. Friend the Member for Dewsbury (Mrs. Taylor) on amendment No. 119 in particular. I have no pecuniary interest, but I should declare an interest as a vice-president of the Association of County Councils. My hon. Friend mentioned several organisations, such as the Ramblers Association. On an all-party basis, the Association of County Councils is worried about what the Government are doing in terms of recreation and conservation as the water authorities are major land owners in this country.
The Association of County Councils is especially concerned about what happened in Committee. It feels that the greatest potential weakness in the draft code proposed by Ministers in Committee was the suggestion that it should apply only to land directly related to water supply and works. I stress the words "directly related". In Committee, the Minister accepted that the vast areas of land currently owned by the water authorities but not used in their core water operations might not be covered by the code, so the water plcs set up by the private companies to manage their non-operational lands will not be covered by the proposed duties in relation to conservation, recreation and public access.
Clause 6 places a duty on those private companies— understandably, because they are private companies—to be concerned with economy and with profit-making, but we are dealing with institutions which hitherto have had a public responsibility. Clause 6 conflicts with anything that the code may state. The private companies can say that they have a duty under clause 6 to make a profit and that any code in operation must he secondary to that.
The Association of County Councils is worried because several councils are affected, including national park land in Cumbria, north Yorkshire, Devon, Somerset and the Peak District. In all those areas, water authorities own large amounts of land, some of which is not directly related to their core activities. The Secretary of State has tabled


amendments to maintain public access to certain areas in the Lake District and the Elan valley, but they do not go nearly far enough and they neglect and ignore all the other areas to which the public now have access and where conservation is an issue. Such land is not exactly public land, but the public have rights over the land because it is overseen by a responsible public body rather than one designed purely to make a profit for its shareholders.

Mr. Peter L. Pike: Is my right hon. Friend fully aware of the Secretary of State's comments yesterday when he made it clear that one of the main objectives of the Bill is the privatisation of the 500,000 acres of land at present owned by the water authorities? My hon. Friend's fears about the future of recreation and access are therefore justified because the lands will obviously be flogged off to make money for the water authorities.

Mr. Oakes: My hon. Friend the Member for Burnley (Mr. Pike) is absolutely right. The clear object of the Bill is to make money for the shareholders because they will face great difficulties with the European Community and the standards of water purity and sea pollution. The only way for this rip-off to take place and for shares to be sold is by selling the land. I mentioned Devon, Somerset and north Yorkshire. Conservative Members should not think that I am talking about Labour-controlled councils because those are all solidly Conservative controlled, but they are worried about the Bill, as is the Association of County Councils.
I do not want to delay the debate because we face the guillotine, but I plead with the Minister to accept amendment No. 119.

Mr. Richard Livsey: I wish to draw the attention of the House to my amendment No. 110 in this series. The amendment draws attention to the necessity
To preserve and maintain public rights of access to areas of woodland, mountain, moor, heath, down, cliff, water areas including reservoirs, or foreshore and other places of natural beauty.
It is essential that that right should be continued and protection given to those areas after privatisation has taken place, as I fear that it may.
I wish to draw the Minister's attention to an anachronism in my constituency, about 10 per cent. of which, under the Bill, is to be flogged off. We have heard that the Elan valley is apparently to be given some protection. I certainly welcome that because it is an improvement on the present position. That area is particularly important because, since the Water Act 1973 and the rights that have been mentioned came into being, there have been developments at Llanwrtyd Wells in my constituency, to which thousands of walkers on international walks have been attracted. Very often, at the weekend, there are 300 or 400 of them using the rights of way in that area. A tourist industry of considerable importance has grown up in this remote area. People from as far away as New Zealand come to walk there and enjoy the Welsh countryside. It is important that they should have continued access to this part of the world. I assume that continued access will be ensured, partly through the

Birmingham Corporation Act 1892. The Victorians were far-sighted enough to ensure that people would have the right to enjoy the countryside and fresh air.
We should compare that area with another part of my constituency—the 21,000 acres that the Welsh water authority owns in the Brecon Beacons national park, where there are a number of reservoirs at Talybont, Dolygaer, Pontsticill, Taf Fechan and other places. At present, people have access in those places to go to the foreshore for fishing and other recreational pursuits. There are rights of way through the area, which is on the edge of an area with a population of 1 million people in south Wales—mainly in Glamorgan—who make great use of those access facilities at the weekend for their enjoyment. If subsidiary companies are formed for recreational purposes by, for example, Welsh Water plc, it is absolutely vital that access continues to be allowed to that land.
I am pleased that Government amendments Nos. 61 and 62—I realise that we are not discussing them now—indicate a considerable change of heart on the part of the Government in relation to allowing more access, which I welcome. However, we must also consider charging, and the desirability to have regard, as the Bill puts it——

Mr. Nicholas Soames: I entirely sympathise with the point that the hon. Gentleman is making. Is he not aware that substantial safeguards on precisely the points that he raises are already built into the Bill?

Mr. Livsey: The Bill contains some safeguards, but we have tabled our amendments because those safeguards are insufficient. That is certainly the view of many people outside the House. There is no doubt that the interpretation of the Bill, after privatisation, will be vital in determining whether people will have ready access to the land. Concern has been expressed by the Countryside Commission, the National Trust and the national parks about such problems. It is to be hoped that the Government will accept the amendments as improvements to their own and ensure cast-iron guarantees of access so that people may continue to enjoy areas that they have previously enjoyed, especially areas of outstanding natural beauty.

Mr. Andrew F. Bennett: I shall press the amendments of my hon. Friends because I am keen to ensure that conflict does not return to the countryside. As a young person I went out walking and climbing from Manchester virtually every Sunday for 10 years. I remember the end of an era when there was considerable conflict between walkers and climbers, and between gamekeepers and water bailiffs. Fortunately, most of that conflict has disappeared from the countryside as a result of access agreements and a more enlightened attitude by water authorities and others.
I still remember when we had lumps of peat thrown at us by one of the water bailiffs who wanted us off the rock climb. I also remember when we were taken off Stockport water authority land on the banks of Kinder Scout simply because we brewed up with a primus stove. I shall not recount to the House all the tricks that we got up to as teenagers in order to get revenge on the water bailiffs and gamekeepers, but certainly some of them had nothing to do with maintaining water purity.
I do not believe that the Government deliberately want to bring back an era of conflict in the countryside, but I warn them that if sufficient people find that their rights of


access to the countryside have been diminished, they will fight hard to protect them. I fear that, perhaps as a result of the misdrafting of the Bill, or the Government's failure to put the case clearly, there is much confusion. Many people feel that, as a result of that confusion, and the inaccuracies within the Bill, that conflict may return. It is the duty of the House to ensure that the Bill—however bad —is clear and does not encourage future conflict in the countryside. People's rights of access should be clearly set out.
I am concerned about three major points. First, existing rights should be absolutely guaranteed for the future. Secondly, anything that people have previously enjoyed free of charge should not be charged for. Thirdly, the legislation should encourage the establishment of new rights.
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There will not be much problem about recorded public rights of way, but in many parts of the country there are many public rights of way which have never been recorded. Although they might be put on the map at some point, on the whole no one has argued about them because they are de facto rights of way—one can see the path clearly—and for 10 or 15 years no one has stopped people using them.
In the Peak district and increasingly in other national parks and in areas within them that are owned by the water authorities there are areas that are subject to access agreements which have played a major part. I want an absolute guarantee from the Minister that all such areas are protected in the legislation, not only in the context of the new water companies but in that of any subsidiary bodies to which they may give rise. My hon. Friend the Member for Dewsbury (Mrs. Taylor) said that the Minister claimed in Committee that the new bodies would be bound to protect public rights and that any subsidiary bodies or new companies resulting from changes of ownership of the land would he so bound.
It seems that counsel's opinion suggests that the Minister was wrong, and we need to clarify whether the Minister still believes that his opinion was right and why he thinks that the legal opinion is wrong—if he does. We need a guarantee at the end of the debate that all existing rights will be continued by the water companies in their water activities and in any other use or sale of the land into which they enter.

The Parliamentary Under-Secretary of State for the Environment (Mr. Colin Moynihan): In order to assist the hon. Gentleman on this specific point, may I tell him that counsel's opinion, to which he referred, said that in certain circumstances the duty might not be effective. These limited and technical circumstances are being considered carefully, but generally speaking, if the undertakers continue to use the land transferred for their functions, the duties will bite in full.

Mr. Bennett: The Minister said that the Government are reviewing the position. Is that an undertaking that if he cannot give us a clear statement today a clear statement will be given to the House of Lords where, if necessary, the Government will table amendments? Would the Minister like to give us that assurance?

Mr. Moynihan: I made it clear that, as we have just received counsel's opinion and have listened carefully to

the representations made by my hon. Friend the Member for High Peak (Mr. Hawkins) and the Ramblers Association, it is right and proper that we should consider the limited and technical arguments that have been put forward. If we see the need to return to the House and take the matter further, we shall. We do not believe that the position of the Ramblers Association, as set out in its press release, is accurate, but we accept that counsel's opinion referred to specific circumstances which we need to review in detail. I am sure that the hon. Gentleman will welcome that.

Mr. Bennett: The Minister has not made it as clear as I should like that he will table an amendment, but I think the gist of his point is that, if necessary, he will. I am sure that the other place will examine it carefully.
The Minister talked about water undertaking activities. The bodies about which I am concerned, such as the Ramblers Association and the Peak and Northern Footpaths Society, want a guarantee that the duty will apply not only to land retained for water gathering but to land which may be passed on to other bodies. In large areas in the west Pennines, where water gathering was established in the last century, water-gathering activities are no longer particularly economic because of the better use of water and the bigger reservoirs at Hirlmere, Hawes water and Vyrnwy have come into use. Some of those reservoirs might be taken out of use—I know that there are safety arguments, and so on. I am determined that not only the water authorities but any bodies to which they dispose of land will have this duty.
Access must be free. I hope the Minister will make it absolutely clear that there is no intention to charge people who go on foot. I accept the argument for charging for some services such as car parking.
I want to press the Minister on new rights. I am sure that he is well aware that one of the problems, particularly in the Pennines but also elsewhere, is that the overuse of some footpaths has led to severe problems of erosion. There is a great deal of concern about the Pennine way, some sections of which have to be protected artificially because of the large numbers of people who use them. One of the best ways of protecting paths is to encourage people to use alternatives. By developing access agreements the Peak District national park has enabled people to go to areas such as Kinder Scout, where they can choose where to go rather than follow a specific footpath that might suffer dramatically from erosion.
I want a guarantee that there will be clear powers to ensure that new access agreements can be created on water land in cases in which that would clearly be in the interests of the conservation of footpaths or of an area in general. There must be no charges for such access agreements. All the national parks make the point that the Government have not been overgenerous with their funding, and that there are problems with paying for access agreements. At the moment the Peak district park makes only modest payments, which usually go to local farmers rather than to the water authority or the large landowners. I should not like any restrictions on the development of new access agreements because the new water companies demanded large sums of money.
I want a guarantee that the Minister will introduce clarity and ensure that conflict in the countryside does not arise. I want him to guarantee that existing rights are preserved and that no system of charges will be


introduced. There must be a system that will ensure that new and greater access to the areas that are held by the water companies can be opened up.

Mr. Christopher Hawkins: The hon. Member for Dewsbury (Mrs. Taylor) said that the opinion of the Ramblers Association's Queen's counsel firmly stated that the duties imposed in the Bill for recreation and access did not relate to land whoever it was owned by. The opinion was not quite as firm or all-embracing as that, although I agree with the hon. Lady that certain aspects are not properly protected in the Bill. I arranged the meeting between my hon. and learned Friend the Minister and the Ramblers Association and its QC at which the association expressed its worries.
I thank the Government for responding to the anxieties of the public, especially in areas such as my constituency, which has been mentioned several times, and for tabling amendments to meet some of those concerns.
I support what the hon. Member for Denton and Reddish (Mr. Bennett) said; we want to know that the Bill will protect not only the legal and statutory rights of access but all existing rights that have been agreed on a voluntary or permissive basis by the water authorities, sometimes in a public-spirited way to which I pay tribute. I also agree with the hon. Gentleman that we do not want people to be charged for access to the national parks or to have little people with machines asking for money for tickets as climbers come down a steep limestone face in the Peak district. There is a case for some areas of the countryside to be freely available—by which I mean, at no charge—to members of the public.
It would greatly help to increase public support for the Bill if Ministers made it clear that these rights and freedoms will be protected. If they are not fully protected by the amendments tabled today, which I welcome—I am pleased that my hon. Friend intervened to say that Ministers are still considering the legal advice that has been given to them—I hope that steps will be taken in another place completely to clarify the issues so that the public do not feel that the Bill removes current rights to access.

Mr. Chris Mullin: As I am sure you will be aware, Mr. Deputy Speaker, we live in the age of the looter. Public assets which have been accumulated over 100 years due to the foresight of our ancestors are now, in every walk of life—and water is only the latest —being auctioned off to the highest bidder and the proceeds used to fuel the illusion of prosperity. No doubt the perpetrators will be in Bermuda by the time the roof comes in, and the Labour party will then be called in to clear up the mess.
When this subject was raised in Committee, Tory Members became quite agitated when I said that behind the urbane and civilised men and one or two women on the Conservative Benches lay every species of spiv and con man known to civilisation. I know that some Conservative Members care about what happens to the great land assets owned by the water authorities, but they are very few. That must be our conclusion, particularly because only one Conservative Back Bencher has had anything to say on

this issue today. Increasingly we are falling to the tender mercies of the estate agents and accountants who clutter up the Conservative Benches.
What is about to happen to the half a million or more acres of some of our most beautiful landscape owned by the water authorities is, I am afraid, a result of the actions of Conservative Members. There have been many references to beautiful landscape in the Peak district national park, in Thirlmere and in Kielder which is within the Northumbrian water authority area close to my constituency. Reference was also made to the Elan valley.
Yesterday the hon. Member for Rutland and Melton (Mr. Latham) entered special pleas for exemption from proposed development for land in or near his constituency. It would be easier to take such pleas seriously if there was a general concern on the Conservative Benches about what might happen. It is a little distasteful to hear Conservative Members asking for exemptions or assurances from Ministers simply for a particular landscape or site which happens to be close to their constituents and their own backyards. We would like to see the measures in clause 7 addressed to all the assets and not just to those where personal concerns are involved.
Mr. Deputy Speaker, did you see that excellent "Panorama" programme on Monday evening about the impending privatisation of the water authorities? It contained an interview with a farmer in Thirlmere in the Lake district. He was a water authority tenant who had farmed there all his life, as had his father before him. The father was recovering from cancer and was worried whether the tenancy would survive to be handed on to his son. He was also concerned to know whether the cowsheds on his farm were to be handed over for development and turned into luxury yuppie housing. We may have thought that it was basic enough to get an assurance about this as it must be the easiest case in the world for such an assurance to be forthcoming. However, "Panorama" could not obtain an assurance from North West Water that there were no such plans. That provides a clue about the future and it must be matched against any assurances which we may receive from time to time from the Government Front Bench.
All the signs are that those who are about to buy up the water industry and the land that goes with it consider the assets ripe for looting and can hardly wait to get their hands on it. Clause 7 brings us to the heart of the matter. It is a grudging acknowledgment by the Government that there are assets worth preserving and that there is something worth handing over to our ancestors.
As my Friend the Member for Dewsbury (Mrs. Taylor) said from the Opposition Front Bench, and as many hon. Members of all shades of opinion have said, it is pathetically weak to use phrases like "having regard to", "take into account", "desirability" or "reasonably practical". The purpose of the amendment is to mitigate the great damage which we believe will be inflicted on the half million or so acres owned by the water authorities.
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The concern is very widespread. All the members of the Standing Committee were deluged by briefs from every conceivable interest. Only in the past few days, I received a brief from the Council for the Protection of Rural England which states:


There is no technical justification why the freehold of the half a million acres of land currently owned by the water authorities should be transferred to the new water utility PLCs.
It also states:
There are currently no effective arrangements in the Bill to safeguard the existing public interests which are currently enshrined in all water authority land under section 48 of the Wildlife and Countryside Act. The Secretary of State's watchdog role over the clause 7 environmental duties is hopelessly inadequate, since he will only be able to intervene on a sporadic and post hoc basis.
That is not a party political broadcast from the Labour party. That is the view of the Council for the Protection of Rural England which enjoys the support of many people who, on most issues, take the opposite view from that of my hon. Friends and I.
The CPRE proposes something more robust than is contained in the amendments. It wants to see all the land presently vested in the water companies handed over to the National Rivers Authority and administered and protected in that way. Our amendments are more modest in the hope that they will extract a generous reply from the Minister.
Amendment No. 121 seeks to exempt from charges access on foot to water authority land. Amendment No. 119 seeks to bring all water authority land within the miserly protection proposed in clauses 7 to 9. We had a discussion in Committee about the code of practice provided for in clause 9, which is supposed to give effect to the good intentions in clause 7. The essential flaw is that the code of practice is completely unenforceable. It is totally advisory and no one need take the blindest bit of notice of it and all the signs are that that is what will happen. The most outrageous flaw—we have pursued the Minister about this—is that the code of practice does not apply to land hived off to subsidiary companies owned by privatised water companies. It will not apply to land which is sold.
We pursued the Minister up hill and down dale over that. He wriggled a great deal, but we eventually extracted one or two points. He said that the code and the good intentions in clause 7 would apply to what he called all "operational land". There is no definition in the Bill of "operational land". We do not know whether that is land on which a sewage station or a reservoir is located. We do not know whether the definition is wider than that. However, we have some clues.
Several weeks ago, the hon. Member for Delyn (Mr. Raffan) was told by the Secretary of State for the Environment that 95 per cent. of the Elan valley—88,000 acres—would be regarded as "operational land". If that is so, it is quite encouraging. However, there is nothing in the Bill to suggest that it is so. I suspect, as many of my hon. Friends and people outside this place suspect, that this rather pathetic protection will apply to a damn sight less than 95 per cent. of the 550,000 acres currently owned by the water authorities.
We take note of what the Minister confirmed in Committee—that "operational land" would apply to 95 per cent. of the Elan valley. Other hon. Members have drawn the Minister's attention to the counsel's opinion and no doubt the Minister will want to comment on it. Our amendments are modest and do not do justice to the outrage that is understandably felt about what will happen to parts of our most beautiful landscapes. I commend them to the House.

Mr. Pike: I shall be brief because we want to hear the Minister's comments on these important amendments before we vote under the guillotine.
Leaving aside the Bill's privatisation aspects, clause 7 and the related provisions, more than any other, have been the subject of lobbying of right hon. and hon. Members in all parts of the Committee. That shows the genuine concern that is felt and why, despite moves made by the Government since the Committee stage, it is necessary to make further amendments. The Minister said that he is considering legal opinion and may make further changes, if he deems that appropriate, when the Bill is considered in another place. I accept the basis on which the Minister gave that assurance, but I hope that he will also be prepared to meet representatives of the organisations that are expressing concern.
Even at this stage, it is unsatisfactory for the Minister to give just this House and another place assurances about the Government's intentions, because they must also convince others outside. Even if the Minister does not recognise this, there is a credibility gap about the Government's intentions between them and the Ramblers Association, the British Mountaineering Council, the Greater Manchester countryside unit, the CPRE, and the National Trust. I could rattle off the names of organisation after organisation and read out any number of comments from various briefs, including one from anglers. The Minister must convince not only Parliament but those outside who are actively concerned about ensuring that in respect of access to land currently owned by water authorities the status quo will be at least maintained if not improved.
Many more people are concerned about the Government's real intention, having heard of the response made by the Secretary of State for the Environment in yesterday's main debate, when he said that one of the Bill's important objectives is the privatisation of 500,000 acres of land. We have said all along that that was the Bill's fundamental objective, and that the only way in which privatisation will pay is by people making money from the land they can acquire. The Secretary of State let that out of the bag yesterday, underlining that that was the Bill's main objective. Whether or not he did so intentionally, I do not know—but he did it.
The organisations whose fears we are expressing will be even more fearful of the consequences of clause 7 if amendments are not made. If the Government are not prepared to move today, there will be even less time available for dealing with that aspect, because the Bill has only to pass through the other place. I hope that the Government recognise the genuine fears that exist and that they must do something if they are not to lose the confidence of people throughout the country who want to ensure that recreational opportunities—whether for rambling, angling, or whatever—are retained.

Mr. Moynihan: My right hon. Friend the Secretary of State and I are more than happy to meet relevant bodies to discuss the important issues that have been raised. Yesterday, I met representatives of the Sports Council, and a couple of days ago I met the chairmen of all the regional councils for sport and recreation, when we discussed those issues in considerable detail. My hon. and learned Friend the Minister for Water and Planning met with my hon. Friend the Member for High Peak (Mr. Hawkins) and other representatives of the Ramblers


Association. We shall of course continue to consider representations, not least those on recommendations concerning the code of practice, which Ministers can still review.
The hon. Member for Burnley (Mr. Pike) reflected on my right hon. Friend's comments of yesterday evening, but he should have listened more carefully to my right hon. Friend's remarks about land. Most national parks land is, and always has been, in private ownership. Ninety-seven per cent. of the Yorkshire dales national park is in private ownership, and—if one includes 10 per cent. held by the National Trust—88 per cent. of Exmoor is privately owned, yet one does not see that land desecrated and spoilt by undesirable development.
It is an inescapable fact that proper regulation does not require public ownership. If it did, not one acre of land on these islands would be other than in public ownership. With planning controls and the proper regulation that we support and are providing, land can be as well protected in the private sector as in the public. If public bodies do not need land for proper public functions, why should they have it?
The Bill preserves in full, in clause 7(2) and (3), the present obligations of water authorities to have regard to the desirability of preserving public rights of access to land and to put their water and land to the best recreational use. Those are broad and substantial duties, but in Committee my hon. and learned Friend the Minister for Water and Planning said that we wanted to consider ways in which they can be further strengthened, clarified and updated. Public access to the water authorities' estates is of great importance because the authorities hold in highland and upland areas much land of great environmental and recreational significance.
We concluded that the general power in clause 180 to vary by order local statutory provision as a consequence of the Bill shall not apply to so much of such provisions as concerns public access and amenity. That is particularly relevant to the Manchester and Birmingham local Acts, and my hon. and learned Friend gave an assurance in Committee that the Government have no intention of using that power to revoke or amend the important provisions of those Acts, which provide for public access to the Elan valley and to parts of the Lake district and Peak district.

Mr. Roger Knapman: Does my hon. Friend accept that the Forestry Commission already charges the public for access to some of its land in my constituency, even when they are on foot?

Mr. Moynihan: I accept that, and it is vital that the flexibility that exists and has operated well in the past does not change in the future. I shall deal later with the specific subject of charging. My hon. Friend makes a pertinent point, because to accept the amendment would be to lose the freedom to make appropriate charges, not least to meet the cost of restocking rivers with fish—an activity requiring much energy, effort and financial expenditure. If charges are necessary for that purpose, there should be no prohibition on their being made in future.
The Ramblers Association and other interested bodies welcomed our assurances, but after further discussion on rights of way, we agreed that it is right that our firm

intention should be reflected in the Bill. Some concern has been expressed about clause 7(2), which imposes on the National Rivers Authority and the undertakers the obligation
to have regard to the desirability of preserving public rights of access
to water authority land, and about whether that provision should be much clearer about its application to permissive or concessionary routes and, further, to the important and significant right to roam. We concluded that it is important to amend the Bill to embrace all those rights, to ensure that, in future, not just statutory rights of way but permissive or concessionary rights of access and the right to roam are embraced. We achieved that by proposing an amendment to leave out the words "public rights" and insert
for the public any freedom
of access to make it explicit that we are preserving for the public freedom of access to the land in question—whether one is considering statutory rights of way, permissive or concessionary rights of access, or the right to roam. I very much hope that the two Government amendments that relate to this debate will be welcomed by both sides of the House.

Mr. Andrew F. Bennett: Will the Minister give way?

Mr. Moynihan: No. I shall move on and rapidly cover the other points that were raised.
The hon. Member for Dewsbury (Mrs. Taylor) raised three significant and important points, and I shall swiftly respond to them.
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The amendments focus on the central features of the general environmental duties concerning conservation, public access and recreation to be imposed on the NRA and the appointed companies. I remind the House of the scope of our proposals. First, they preserve for the privatised industry all the present duties of the public sector. That includes the duty to further conservation and to put its water and land to the best use for recreation. Those duties are supplemented by a duty on the NRA generally to promote conservation and recreation. In addition, all the duties are made enforceable by the Secretary of State who is to take into account how far the companies have complied with the code of practice which we have already published in draft and which represents the fullest expression so far of what good practice in those matters represents. Therefore, there are absolutely no grounds for arguing that conservation, access and recreation are inadequately covered in the Bill. The water industry will be subject to fuller and clearer obligations after privatisation. Those obligations are more substantial than those attaching to any other industry in the country in the public or private sector.
In amendments Nos. 115 to 118 the House is asked to apply those duties not only to the performance of functions but to the ownership of land. Amendment No. 119 seeks to extend the duties to any successor owners of the land. Let me begin with the proposals that the duties should attach not only to the performance of functions but to the ownership of any land. The central question is simple. The general environmental duties in the Bill are special ones designed to apply specifically to water industry functions, reflecting their uniquely extensive impact on the environment through the collection and


control of water resources, draining operations and pipelaying and sewage activities. The nature of those functions, and not any characteristics of the land in question, requires those obligations. What logic could there be in applying them to the ownership of that land? It would create a quite unparalleled protective regime for land, based not on any special quality or requirement of the land, or any pressures or operations to which it might be subject, but simply because the land happens to be or to have been in the ownership of an appointed company.
Hon. Members can imagine the absurdities to which the amendments would lead. One can readily visualise small patches of urban land of no conservation or amenity value whose use for housing, employment or some other social need was for ever blighted by the need for further conservation and recreation in ways related to the performance of functions that it no longer serves. The general management and use of land outside the special functions of the industry are matters for the planning system to regulate.
The same considerations apply to amendment No. 119 which would extend the duties to any successor owner of the land. As long as the conservation, access and landscape duties apply to the performance of all water industry functions, full and sufficient protection is afforded.

Mr. Andrew F. Bennett: Will the Minister give way?

Mr. Moynihan: No, I cannot give way.
The hon. Lady stated that "having regard to" duties are ineffective. That is wrong. Under that duty the water authorities have been opening up access and taking down fences since 1974, and, in any case, the Bill makes the duty fully enforceable by the Secretary of State. It is also irrelevant. Ramblers and climbers are further protected by the duty in clause 7(4) on companies to put their lands to best use for recreation. That is an unqualified duty, not a "have regard to" duty.
The hon. Lady referred to counsel's opinion about transfers to subsidiary companies. I hope that I have made it clear to the House that the opinion suggests that in certain circumstances the duty might not be effective. As I mentioned, we are considering the limited and technical arguments in the opinion, and if a technical amendment to the Bill is necessary, we shall table such an amendment, but, generally speaking, if undertakers continue to use any land transferred for their functions, the duties will bite.
Finally, the hon. Lady referred to charging. Nothing in the Bill changes the present position. The provision in clause 7(5) exists simply to make it clear that companies, like water authorities now, can charge for the use of recreational facilities. That must be right, as that flexibility needs to continue. The scare stories put about by Opposition Members are quite wrong. For the most part, the water authorities do not charge but allow people to roam freely on their lands in the highlands and uplands. Quite reasonably, there are often charges for car parks and jetties, but not for ordinary access on foot. Where no specific facilities are provided, the levying of charges has usually been considered unrealistic and impractical. Without the amendment, that sensible and pragmatic position is expected to continue.
I have touched very briefly on the main points raised in the debate. I apologise to the hon. Member for Denton and Reddish (Mr. Bennett) for not giving way, but it gives the Opposition Front Bench the opportunity to respond.

Ms. Walley: Because of the guillotine, there is not time for me to raise with the Minister some of the important comments made and issues raised in the debate. The Opposition wish to make clear three basic points. First, we want clause 7 to have teeth, and our amendments give the clause teeth. Secondly, the Minister tells us that he is currently having discussions with the Ramblers Association, the Sports Council and other bodies. Now is the time for action. The Bill will soon be the law of the land and, unless we receive some real assurances from the Government, there will no longer be any time for further talks.
Access to land is an old problem which has been with us for a century. Organisations such as the Ramblers Association have been campaigning for proper access to land, whether it is in private or public ownership. We want there to be public access to all the land in the ownership of the water authorities post-privatisation. When we debated this matter in Committee it appeared that there was no difference between the views of the Government and the Opposition, yet the necesary provisions are still not spelt out clearly in the Bill.
The amendments are very clear, and if the House accepts them, or if the Government give us an assurance that they will accept them in another place, we shall ensure that there is access to all the land, which people throughout the country have campaigned and fought for for years, and for which in certain parts of the country they are still campaigning, with the help of organisations such as the Ramblers Association. For that reason, we feel that the amendments are important.
Thirdly, if the Government consider that it is not necessary to include our amendment which would remove the right to charge people for access to the land on foot, why does he not accept it now? Does the Minister envisage that in the future the new companies will not charge only for facilities, which would not be unreasonable, and that it will be in order for new companies to charge people to travel on foot over land which has been open for a long time?

Amendment negatived.

Amendments made: No. 61, in page 7, line 42 leave out `public rights' and insert
'for the public any freedom'.
No. 62, in page 7, line 46 leave out 'rights' and insert 'freedom'.
No. 26, in page 8, line 21 at end insert—
'(4A) It shall be the duty of a relevant body, in determining what steps to take in performance of any duty imposed by virtue of subsection (3) or (4)(c) above, to take into account the needs of persons who are chronically sick or disabled.'.—[Mr. Moynihan.]

Amendment proposed: No. 121, in page 8, line 24 at end insert
`with the exception of access on foot by the public to the land'.—[Mrs. Ann Taylor.]

Question put, That the amendment be made:—

The House divided: Ayes 204, Noes 285.

Division No. 130]
[5.39 pm


AYES


Allen, Graham
Barnes, Harry (Derbyshire NE)


Anderson, Donald
Barnes, Mrs Rosie (Greenwich)


Archer, Rt Hon Peter
Battle, John


Armstrong, Hilary
Beaumont-Dark, Anthony


Ashdown, Rt Hon Paddy
Beckett, Margaret


Ashley, Rt Hon Jack
Benn, Rt Hon Tony


Ashton, Joe
Bennett, A. F. (D'nt'n &amp; R'dish)


Banks, Tony (Newham NW)
Bermingham, Gerald






Bidwell, Sydney
Hughes, Robert (Aberdeen N)


Blair, Tony
Hughes, Roy (Newport E)


Blunkett, David
Hughes, Sean (Knowsley S)


Boateng, Paul
Hughes, Simon (Southwark)


Boyes, Roland
Illsley, Eric


Bradley, Keith
Ingram, Adam


Bray, Dr Jeremy
Janner, Greville


Brown, Gordon (D'mline E)
Johnston, Sir Russell


Brown, Nicholas (Newcastle E)
Jones, Barry (Alyn &amp; Deeside)


Brown, Ron (Edinburgh Leith)
Jones, Ieuan (Ynys Môn)


Bruce, Malcolm (Gordon)
Jones, Martyn (Clwyd S W)


Buckley, George J.
Kennedy, Charles


Caborn, Richard
Kinnock, Rt Hon Neil


Callaghan, Jim
Kirkwood, Archy


Campbell, Ron (Blyth Valley)
Leadbitter, Ted


Campbell-Savours, D. N.
Leighton, Ron


Cartwright, John
Lestor, Joan (Eccles)


Clark, Dr David (S Shields)
Lewis, Terry


Clarke, Tom (Monklands W)
Litherland, Robert


Clay, Bob
Livingstone, Ken


Clelland, David
Livsey, Richard


Clwyd, Mrs Ann
Lloyd, Tony (Stretford)


Coleman, Donald
Lofthouse, Geoffrey


Cook, Frank (Stockton N)
McAvoy, Thomas


Cook, Robin (Livingston)
McCartney, Ian


Corbett, Robin
Macdonald, Calum A.


Corbyn, Jeremy
McFall, John


Cousins, Jim
McKay, Allen (Barnsley West)


Crowther, Stan
McKelvey, William


Cryer, Bob
McTaggart, Bob


Cummings, John
McWilliam, John


Cunliffe, Lawrence
Mahon, Mrs Alice


Cunningham, Dr John
Marek, Dr John


Davies, Rt Hon Denzil (Llanelli)
Marshall, David (Shettleston)


Davies, Ron (Caerphilly)
Marshall, Jim (Leicester S)


Davis, Terry (B'ham Hodge H'I)
Martin, Michael J. (Springburn)


Dewar, Donald
Maxton, John


Dixon, Don
Meacher, Michael


Dobson, Frank
Meale, Alan


Doran, Frank
Michie, Bill (Sheffield Heeley)


Douglas, Dick
Mitchell, Austin (G't Grimsby)


Dunwoody, Hon Mrs Gwyneth
Moonie, Dr Lewis


Eadie, Alexander
Morgan, Rhodri


Eastham, Ken
Morley, Elliott


Evans, John (St Helens N)
Morris, Rt Hon J. (Aberavon)


Fatchett, Derek
Mowlam, Marjorie


Faulds, Andrew
Mullin, Chris


Fearn, Ronald
Murphy, Paul


Field, Frank (Birkenhead)
Nellist, Dave


Fields, Terry (L'pool B G'n)
Oakes, Rt Hon Gordon


Flynn, Paul
O'Brien, William


Foster, Derek
Orme, Rt Hon Stanley


Foulkes, George
Owen, Rt Hon Dr David


Fraser, John
Patchett, Terry


Fyfe, Maria
Pendry, Tom


Galbraith, Sam
Pike, Peter L.


Garrett, John (Norwich South)
Powell, Ray (Ogmore)


George, Bruce
Prescott, John


Gilbert, Rt Hon Dr John
Quin, Ms Joyce


Godman, Dr Norman A.
Radice, Giles


Gould, Bryan
Randall, Stuart


Graham, Thomas
Redmond, Martin


Grant, Bernie (Tottenham)
Rees, Rt Hon Merlyn


Griffiths, Nigel (Edinburgh S)
Reid, Dr John


Griffiths, Win (Bridgend)
Richardson, Jo


Grocott, Bruce
Roberts, Allan (Bootle)


Harman, Ms Harriet
Rogers, Allan


Hattersley, Rt Hon Roy
Rooker, Jeff


Haynes, Frank
Ross, Ernie (Dundee W)


Healey, Rt Hon Denis
Rowlands, Ted


Heffer, Eric S.
Ruddock, Joan


Henderson, Doug
Salmond, Alex


Hinchliffe, David
Sedgemore, Brian


Hogg, N. (C'nauld &amp; Kilsyth)
Sheerman, Barry


Hood, Jimmy
Sheldon, Rt Hon Robert


Howarth, George (Knowsley N)
Shore, Rt Hon Peter


Howell, Rt Hon D. (S'heath)
Skinner, Dennis


Howells, Dr. Kim (Pontypridd)
Smith, Andrew (Oxford E)


Hoyle, Doug
Smith, C. (Isl'ton &amp; F'bury)


Hughes, John (Coventry NE)
Smith, Rt Hon J. (Monk'ds E)





Smyth, Rev Martin (Belfast S)
Welsh, Andrew (Angus E)


Soley, Clive
Welsh, Michael (Doncaster N)


Spearing, Nigel
Wigley, Dafydd


Steel, Rt Hon David
Williams, Rt Hon Alan


Steinberg, Gerry
Williams, Alan W. (Carm'then)


Stott, Roger
Wilson, Brian


Strang, Gavin
Winnick, David


Taylor, Mrs Ann (Dewsbury)
Winterton, Mrs Ann


Taylor, Matthew (Truro)
Winterton, Nicholas


Turner, Dennis
Wise, Mrs Audrey


Vaz, Keith
Worthington, Tony


Wall, Pat
Young, David (Bolton SE)


Wallace, James



Walley, Joan
Tellers for the Ayes:


Wardell, Gareth (Gower)
Mr. Allen Adams and


Wareing, Robert N.
Mrs. Llin Golding.




NOES


Adley, Robert
Devlin, Tim


Alexander, Richard
Dicks, Terry


Alison, Rt Hon Michael
Dorrell, Stephen


Allason, Rupert
Douglas-Hamilton, Lord James


Amery, Rt Hon Julian
Dover, Den


Amess, David
Dunn, Bob


Amos, Alan
Durant, Tony


Arbuthnot, James
Dykes, Hugh


Arnold, Jacques (Gravesham)
Eggar, Tim


Ashby, David
Emery, Sir Peter


Aspinwall, Jack
Evans, David (Welwyn Hatf'd)


Baker, Nicholas (Dorset N)
Fairbairn, Sir Nicholas


Baldry, Tony
Fallon, Michael


Banks, Robert (Harrogate)
Favell, Tony


Batiste, Spencer
Fenner, Dame Peggy


Bellingham, Henry
Fishburn, John Dudley


Bendall, Vivian
Forman, Nigel


Bennett, Nicholas (Pembroke)
Forsyth, Michael (Stirling)


Benyon, W.
Forth, Eric


Bevan, David Gilroy
Fowler, Rt Hon Norman


Biffen, Rt Hon John
Franks, Cecil


Blackburn, Dr John G.
Freeman, Roger


Body, Sir Richard
French, Douglas


Boscawen, Hon Robert
Fry, Peter


Boswell, Tim
Gale, Roger


Bottomley, Peter
Gardiner, George


Bottomley, Mrs Virginia
Garel-Jones, Tristan


Bowden, A (Brighton K'pto'n)
Gill, Christopher


Bowden, Gerald (Dulwich)
Glyn, Dr Alan


Bowis, John
Goodhart, Sir Philip


Boyson, Rt Hon Dr Sir Rhodes
Goodlad, Alastair


Brazier, Julian
Goodson-Wickes, Dr Charles


Bright, Graham
Gorman, Mrs Teresa


Brown, Michael (Brigg &amp; Cl't's)
Gorst, John


Bruce, Ian (Dorset South)
Gow, Ian


Buchanan-Smith, Rt Hon Alick
Grant, Sir Anthony (CambsSW)


Buck, Sir Antony
Greenway, Harry (Ealing N)


Budgen, Nicholas
Greenway, John (Ryedale)


Burt, Alistair
Gregory, Conal


Butler, Chris
Griffiths, Peter (Portsmouth N)


Carlisle, Kenneth (Lincoln)
Grylls, Michael


Carrington, Matthew
Gummer, Rt Hon John Selwyn


Cash, William
Hague, William


Channon, Rt Hon Paul
Hamilton, Neil (Tatton)


Chapman, Sydney
Hampson, Dr Keith


Chope, Christopher
Hanley, Jeremy


Clark, Dr Michael (Rochford)
Hannam, John


Clark, Sir W. (Croydon S)
Hargreaves, A. (B'ham H'Il Gr')


Clarke, Rt Hon K. (Rushcliffe)
Harris, David


Colvin, Michael
Haselhurst, Alan


Conway, Derek
Hawkins, Christopher


Coombs, Anthony (Wyre F'rest)
Hayes, Jerry


Coombs, Simon (Swindon)
Hayhoe, Rt Hon Sir Barney


Cope, Rt Hon John
Hayward, Robert


Cormack, Patrick
Heathcoat-Amory, David


Couchman, James
Heddle, John


Cran, James
Hicks, Mrs Maureen (Wolv' NE)


Critchley, Julian
Hicks, Robert (Cornwall SE)


Currie, Mrs Edwina
Higgins, Rt Hon Terence L.


Curry, David
Hogg, Hon Douglas (Gr'th'm)


Davies, Q. (Stamf'd &amp; Spald'g)
Holt, Richard


Davis, David (Boothferry)
Hordern, Sir Peter






Howard, Michael
Pattie, Rt Hon Sir Geoffrey


Howarth, G. (Cannock &amp; B'wd)
Pawsey, James


Howe, Rt Hon Sir Geoffrey
Porter, Barry (Wirral S)


Howell, Rt Hon David (G'dford)
Porter, David (Waveney)


Howell, Ralph (North Norfolk)
Portillo, Michael


Hughes, Robert G. (Harrow W)
Powell, William (Corby)


Hunt, David (Wirral W)
Price, Sir David


Hunter, Andrew
Raffan, Keith


Hurd, Rt Hon Douglas
Raison, Rt Hon Timothy


Irvine, Michael
Rathbone, Tim


Irving, Charles
Redwood, John


Jack, Michael
Renton, Tim


Janman, Tim
Rhodes James, Robert


Jessel, Toby
Riddick, Graham


Jones, Gwilym (Cardiff N)
Ridley, Rt Hon Nicholas


Jones, Robert B (Herts W)
Ridsdale, Sir Julian


Jopling, Rt Hon Michael
Rifkind, Rt Hon Malcolm


Key, Robert
Roberts, Wyn (Conwy)


Kilfedder, James
Roe, Mrs Marion


King, Roger (B'ham N'thfield)
Rossi, Sir Hugh


Kirkhope, Timothy
Rost, Peter


Knapman, Roger
Rumbold, Mrs Angela


Knight, Greg (Derby North)
Ryder, Richard


Knight, Dame Jill (Edgbaston)
Sackville, Hon Tom


Knox, David
Sainsbury, Hon Tim


Lang, Ian
Sayeed, Jonathan


Latham, Michael
Scott, Nicholas


Lawrence, Ivan
Shaw, David (Dover)


Leigh, Edward (Gainsbor'gh)
Shaw, Sir Giles (Pudsey)


Lester, Jim (Broxtowe)
Shaw, Sir Michael (Scarb')


Lilley, Peter
Shephard, Mrs G. (Norfolk SW)


Lloyd, Sir Ian (Havant)
Shersby, Michael


Lloyd, Peter (Fareham)
Sims, Roger


Lord, Michael
Skeet, Sir Trevor


Luce, Rt Hon Richard
Smith, Tim (Beaconsfield)


McCrindle, Robert
Soames, Hon Nicholas


Macfarlane, Sir Neil
Speller, Tony


MacGregor, Rt Hon John
Spicer, Sir Jim (Dorset W)


MacKay, Andrew (E Berkshire)
Squire, Robin


Maclean, David
Stanbrook, Ivor


McNair-Wilson, Sir Michael
Stanley, Rt Hon Sir John


McNair-Wilson, P. (New Forest)
Steen, Anthony


Madel, David
Stern, Michael


Major, Rt Hon John
Stevens, Lewis


Malins, Humfrey
Stewart, Allan (Eastwood)


Mans, Keith
Stewart, Andy (Sherwood)


Maples, John
Stewart, Rt Hon Ian (Herts N)


Marlow, Tony
Stradling Thomas, Sir John


Marshall, John (Hendon S)
Sumberg, David


Marshall, Michael (Arundel)
Tapsell, Sir Peter


Martin, David (Portsmouth S)
Taylor, Ian (Esher)


Mates, Michael
Taylor, John M (Solihull)


Maude, Hon Francis
Taylor, Teddy (S'end E)


Mellor, David
Tebbit, Rt Hon Norman


Miller, Sir Hal
Temple-Morris, Peter


Mills, Iain
Thompson, D. (Calder Valley)


Mitchell, Andrew (Gedling)
Thompson, Patrick (Norwich N)


Moate, Roger
Thorne, Neil


Monro, Sir Hector
Thurnham, Peter


Morris, M (N'hampton S)
Townend, John (Bridlington)


Morrison, Sir Charles
Townsend, Cyril D. (B'heath)


Morrison, Rt Hon P (Chester)
Tracey, Richard


Moss, Malcolm
Tredinnick, David


Moynihan, Hon Colin
Trippier, David


Mudd, David
Trotter, Neville


Needham, Richard
Twinn, Dr Ian


Nelson, Anthony
Waddington, Rt Hon David


Neubert, Michael
Wakeham, Rt Hon John


Nicholls, Patrick
Waller, Gary


Nicholson, David (Taunton)
Wardle, Charles (Bexhill)


Nicholson, Emma (Devon West)
Warren, Kenneth


Norris, Steve
Watts, John


Onslow, Rt Hon Cranley
Wells, Bowen


Oppenheim, Phillip
Wheeler, John


Page, Richard
Whitney, Ray


Paice, James
Widdecombe, Ann


Patnick, Irvine
Wiggin, Jerry


Patten, Chris (Bath)
Wilshire, David


Patten, John (Oxford W)
Wood, Timothy





Woodcock, Mike
Tellers for the Noes:


Yeo, Tim
Mr. David Lightbown and


Young, Sir George (Acton)
Mr. Alan Howarth.

Question accordingly negatived.

Amendment proposed: No. 119, in page 8, line 26, at end insert—
'(6A) This section applies to any land which was owned before the transfer date by a water authority.'.—[Mrs. Ann Taylor.]

Question put, That the amendment be made:—

The House divided: Ayes 200, Noes 298.

Division No. 131]
[5.51 pm


AYES


Abbott, Ms Diane
Fearn, Ronald


Allen, Graham
Field, Frank (Birkenhead)


Anderson, Donald
Fields, Terry (L'pool B G'n)


Archer, Rt Hon Peter
Flynn, Paul


Armstrong, Hilary
Foster, Derek


Ashdown, Rt Hon Paddy
Foulkes, George


Ashley, Rt Hon Jack
Fraser, John


Ashton, Joe
Fyfe, Maria


Banks, Tony (Newham NW)
Galbraith, Sam


Barnes, Harry (Derbyshire NE)
Garrett, John (Norwich South)


Barnes, Mrs Rosie (Greenwich)
George, Bruce


Battle, John
Gilbert, Rt Hon Dr John


Beckett, Margaret
Godman, Dr Norman A.


Benn, Rt Hon Tony
Gould, Bryan


Bennett, A. F. (D'nt'n &amp; R'dish)
Graham, Thomas


Bermingham, Gerald
Grant, Bernie (Tottenham)


Bidwell, Sydney
Griffiths, Nigel (Edinburgh S)


Blair, Tony
Griffiths, Win (Bridgend)


Blunkett, David
Grocott, Bruce


Boateng, Paul
Harman, Ms Harriet


Boyes, Roland
Hattersley, Rt Hon Roy


Bradley, Keith
Haynes, Frank


Bray, Dr Jeremy
Healey, Rt Hon Denis


Brown, Gordon (D'mline E)
Heffer, Eric S.


Brown, Nicholas (Newcastle E)
Henderson, Doug


Brown, Ron (Edinburgh Leith)
Hinchliffe, David


Bruce, Malcolm (Gordon)
Hogg, N. (C'nauld &amp; Kilsyth)


Buckley, George J.
Hood, Jimmy


Caborn, Richard
Howarth, George (Knowsley N)


Callaghan, Jim
Howell, Rt Hon D. (S'heath)


Campbell, Ron (Blyth Valley)
Howells, Dr. Kim (Pontypridd)


Campbell-Savours, D. N.
Hoyle, Doug


Cartwright, John
Hughes, John (Coventry NE)


Clark, Dr David (S Shields)
Hughes, Robert (Aberdeen N)


Clarke, Tom (Monklands W)
Hughes, Roy (Newport E)


Clay, Bob
Hughes, Sean (Knowsley S)


Clelland, David
Hughes, Simon (Southwark)


Clwyd, Mrs Ann
Illsley, Eric


Coleman, Donald
Ingram, Adam


Cook, Frank (Stockton N)
Janner, Greville


Cook, Robin (Livingston)
Johnston, Sir Russell


Corbett, Robin
Jones, Barry (Alyn &amp; Deeside)


Corbyn, Jeremy
Jones, leuan (Ynys Môn)


Cousins, Jim
Jones, Martyn (Clwyd S W)


Crowther, Stan
Kennedy, Charles


Cryer, Bob
Kinnock, Rt Hon Neil


Cummings, John
Kirkwood, Archy


Cunliffe, Lawrence
Leadbitter, Ted


Cunningham, Dr John
Leighton, Ron


Davies, Rt Hon Denzil (Llanelli)
Lestor, Joan (Eccles)


Davies, Ron (Caerphilly)
Lewis, Terry


Davis, Terry (B'ham Hodge H'I)
Litherland, Robert


Dewar, Donald
Livingstone, Ken


Dixon, Don
Livsey, Richard


Dobson, Frank
Lloyd, Tony (Stretford)


Doran, Frank
Lofthouse, Geoffrey


Douglas, Dick
McAvoy, Thomas


Dunwoody, Hon Mrs Gwyneth
McCartney, Ian


Eadie, Alexander
Macdonald, Calum A.


Eastham, Ken
McFall, John


Evans, John (St Helens N)
McKay, Allen (Barnsley West)


Fatchett, Derek
McKelvey, William


Faulds, Andrew
McTaggart, Bob






McWilliam, John
Rowlands, Ted


Mahon, Mrs Alice
Ruddock, Joan


Marek, Dr John
Salmond, Alex


Marshall, David (Shettleston)
Sedgemore, Brian


Marshall, Jim (Leicester S)
Sheerman, Barry


Martin, David (Portsmouth S)
Sheldon, Rt Hon Robert


Martin, Michael J. (Springburn)
Shore, Rt Hon Peter


Maxton, John
Skinner, Dennis


Meacher, Michael
Smith, Andrew (Oxford E)


Meale, Alan
Smith, C. (Isl'ton &amp; F'bury)


Michie, Bill (Sheffield Heeley)
Smith, Rt Hon J. (Monk'ds E)


Mitchell, Austin (G't Grimsby)
Soley, Clive


Moonie, Dr Lewis
Spearing, Nigel


Morgan, Rhodri
Steel, Rt Hon David


Morley, Elliott
Steinberg, Gerry


Morris, Rt Hon J. (Aberavon)
Strang, Gavin


Mowlam, Marjorie
Taylor, Mrs Ann (Dewsbury)


Mullin, Chris
Taylor, Matthew (Truro)


Murphy, Paul
Turner, Dennis


Nellist, Dave
Vaz, Keith


Oakes, Rt Hon Gordon
Wall, Pat


O'Brien, William
Wallace, James


Orme, Rt Hon Stanley
Walley, Joan


Owen, Rt Hon Dr David
Warded, Gareth (Gower)


Patchett, Terry
Wareing, Robert N.


Pendry, Tom
Welsh, Andrew (Angus E)


Pike, Peter L.
Welsh, Michael (Doncaster N)


Powell, Ray (Ogmore)
Wigley, Dafydd


Prescott, John
Williams, Rt Hon Alan


Quin, Ms Joyce
Williams, Alan W. (Carm'then)


Radice, Giles
Wilson, Brian


Randall, Stuart
Winnick, David


Redmond, Martin
Wise, Mrs Audrey


Rees, Rt Hon Merlyn
Worthington, Tony


Reid, Dr John
Young, David (Bolton SE)


Richardson, Jo



Roberts, Allan (Bootle)
Tellers for the Ayes:


Rogers, Allan
Mr. Allen Adams and


Rooker, Jeff
Mrs. Llin Golding.


Ross, Ernie (Dundee W)





NOES


Adley, Robert
Budgen, Nicholas


Alexander, Richard
Burt, Alistair


Alison, Rt Hon Michael
Butcher, John


Allason, Rupert
Butler, Chris


Amery, Rt Hon Julian
Butterfill, John


Amess, David
Carlisle, Kenneth (Lincoln)


Amos, Alan
Carrington, Matthew


Arbuthnot, James
Cash, William


Arnold, Jacques (Gravesham)
Channon, Rt Hon Paul


Arnold, Tom (Hazel Grove)
Chapman, Sydney


Ashby, David
Chope, Christopher


Aspinwall, Jack
Churchill, Mr


Baker, Rt Hon K. (Mole Valley)
Clark, Dr Michael (Rochford)


Baker, Nicholas (Dorset N)
Clark, Sir W. (Croydon S)


Baldry, Tony
Clarke, Rt Hon K. (Rushcliffe)


Banks, Robert (Harrogate)
Colvin, Michael


Batiste, Spencer
Conway, Derek


Bellingham, Henry
Coombs, Anthony (Wyre F'rest)


Bendall, Vivian
Coombs, Simon (Swindon)


Bennett, Nicholas (Pembroke)
Cope, Rt Hon John


Benyon, W.
Cormack, Patrick


Bevan, David Gilroy
Couchman, James


Biffen, Rt Hon John
Cran, James


Blackburn, Dr John G.
Critchley, Julian


Body, Sir Richard
Currie, Mrs Edwina


Boscawen, Hon Robert
Curry, David


Boswell, Tim
Davies, Q. (Stamf'd &amp; Spald'g)


Bottomley, Peter
Devlin, Tim


Bowden, A (Brighton K'pto'n)
Dicks, Terry


Bowden, Gerald (Dulwich)
Dorrell, Stephen


Bowis, John
Douglas-Hamilton, Lord James


Boyson, Rt Hon Dr Sir Rhodes
Dover, Den


Brazier, Julian
Dunn, Bob


Bright, Graham
Durant, Tony


Brown, Michael (Brigg &amp; Cl't's)
Dykes, Hugh


Bruce, Ian (Dorset South)
Eggar, Tim


Buchanan-Smith, Rt Hon Alick
Emery, Sir Peter


Buck, Sir Antony
Evans, David (Welwyn Hatf'd)





Fairbairn, Sir Nicholas
Lawrence, Ivan


Fallon, Michael
Lee, John (Pendle)


Fenner, Dame Peggy
Leigh, Edward (Gainsbor'gh)


Fishburn, John Dudley
Lennox-Boyd, Hon Mark


Forman, Nigel
Lester, Jim (Broxtowe)


Forsyth, Michael (Stirling)
Lilley, Peter


Forth, Eric
Lloyd, Sir Ian (Havant)


Fowler, Rt Hon Norman
Lloyd, Peter (Fareham)


Franks, Cecil
Lord, Michael


Freeman, Roger
Luce, Rt Hon Richard


French, Douglas
Lyell, Sir Nicholas


Fry, Peter
McCrindle, Robert


Gale, Roger
Macfarlane, Sir Neil


Gardiner, George
MacGregor, Rt Hon John


Garel-Jones, Tristan
MacKay, Andrew (E Berkshire)


Gill, Christopher
Maclean, David


Glyn, Dr Alan
McNair-Wilson, Sir Michael


Goodhart, Sir Philip
McNair-Wilson, P. (New Forest)


Goodlad, Alastair
Madel, David


Goodson-Wickes, Dr Charles
Major, Rt Hon John


Gorman, Mrs Teresa
Malins, Humfrey


Gorst, John
Mans, Keith


Gow, Ian
Maples, John


Grant, Sir Anthony (CambsSW)
Marlow, Tony


Greenway, Harry (Ealing N)
Marshall, John (Hendon S)


Greenway, John (Ryedale)
Marshall, Michael (Arundel)


Gregory, Conal
Martin, David (Portsmouth S)


Griffiths, Peter (Portsmouth N)
Mates, Michael


Ground, Patrick
Mellor, David


Grylls, Michael
Miller, Sir Hal


Gummer, Rt Hon John Selwyn
Mills, Iain


Hague, William
Miscampbell, Norman


Hamilton, Neil (Tatton)
Mitchell, Andrew (Gedling)


Hampson, Dr Keith
Moate, Roger


Hanley, Jeremy
Monro, Sir Hector


Hannam, John
Morris, M (N'hampton S)


Hargreaves, A. (B'ham H'Il Gr')
Morrison, Sir Charles


Hargreaves, Ken (Hyndburn)
Morrison, Rt Hon P (Chester)


Harris, David
Moss, Malcolm


Haselhurst, Alan
Moynihan, Hon Colin


Hawkins, Christopher
Mudd, David


Hayes, Jerry
Neale, Gerrard


Hayhoe, Rt Hon Sir Barney
Nelson, Anthony


Hayward, Robert
Neubert, Michael


Heathcoat-Amory, David
Nicholls, Patrick


Heddle, John
Nicholson, David (Taunton)


Heseltine, Rt Hon Michael
Nicholson, Emma (Devon West)


Hicks, Mrs Maureen (Wolv' NE)
Norris, Steve


Hicks, Robert (Cornwall SE)
Onslow, Rt Hon Cranley


Higgins, Rt Hon Terence L.
Oppenheim, Phillip


Hogg, Hon Douglas (Gr'th'm)
Page, Richard


Holt, Richard
Paice, James


Hordern, Sir Peter
Parkinson, Rt Hon Cecil


Howard, Michael
Patnick, Irvine


Howarth, G. (Cannock &amp; B'wd)
Patten, Chris (Bath)


Howe, Rt Hon Sir Geoffrey
Patten, John (Oxford W)


Howell, Rt Hon David (G'dford)
Pattie, Rt Hon Sir Geoffrey


Howell, Ralph (North Norfolk)
Pawsey, James


Hughes, Robert G. (Harrow W)
Porter, Barry (Wirral S)


Hunt, David (Wirral W)
Porter, David (Waveney)


Hunter, Andrew
Portillo, Michael


Hurd, Rt Hon Douglas
Powell, William (Corby)


Irvine, Michael
Price, Sir David


Irving, Charles
Raffan, Keith


Jack, Michael
Raison, Rt Hon Timothy


Janman, Tim
Rathbone, Tim


Jessel, Toby
Redwood, John


Jones, Gwilym (Cardiff N)
Renton, Tim


Jones, Robert B (Herts W)
Rhodes James, Robert


Jopling, Rt Hon Michael
Riddick, Graham


Kellett-Bowman, Dame Elaine
Ridley, Rt Hon Nicholas


Kilfedder, James
Ridsdale, Sir Julian


King, Roger (B'ham N'thfield)
Rifkind, Rt Hon Malcolm


Kirkhope, Timothy
Roberts, Wyn (Conwy)


Knapman, Roger
Roe, Mrs Marion


Knight, Greg (Derby North)
Rossi, Sir Hugh


Knight, Dame Jill (Edgbaston)
Rost, Peter


Knox, David
Rumbold, Mrs Angela


Lang, Ian
Ryder, Richard


Latham, Michael
Sackville, Hon Tom






Sainsbury, Hon Tim
Thompson, Patrick (Norwich N)


Sayeed, Jonathan
Thorne, Neil


Scott, Nicholas
Thurnham, Peter


Shaw, David (Dover)
Townend, John (Bridlington)


Shaw, Sir Giles (Pudsey)
Townsend, Cyril D. (B'heath)


Shaw, Sir Michael (Scarb')
Tracey, Richard


Shephard, Mrs G. (Norfolk SW)
Tredinnick, David


Shersby, Michael
Trippier, David


Sims, Roger
Trotter, Neville


Skeet, Sir Trevor
Twinn, Dr Ian


Smith, Tim (Beaconsfield)
Vaughan, Sir Gerard


Soames, Hon Nicholas
Waddington, Rt Hon David


Speller, Tony
Wakeham, Rt Hon John


Spicer, Sir Jim (Dorset W)
Waller, Gary


Spicer, Michael (S Worcs)
Walters, Sir Dennis


Squire, Robin
Wardle, Charles (Bexhill)


Stanbrook, Ivor
Warren, Kenneth


Stanley, Rt Hon Sir John
Watts, John


Steen, Anthony
Wells, Bowen


Stern, Michael
Wheeler, John


Stevens, Lewis
Whitney, Ray


Stewart, Allan (Eastwood)
Widdecombe, Ann


Stewart, Andy (Sherwood)
Wiggin, Jerry


Stewart, Rt Hon Ian (Herts N)
Wilshire, David


Stradling Thomas, Sir John
Wolfson, Mark


Sumberg, David
Wood, Timothy


Tapsell, Sir Peter
Woodcock, Mike


Taylor, Ian (Esher)
Yeo, Tim


Taylor, John M (Solihull)
Young, Sir George (Acton)


Taylor, Teddy (S'end E)



Tebbit, Rt Hon Norman
Tellers for the Noes:


Temple-Morris, Peter
Mr. David Lightbown and


Thompson, D. (Calder Valley)
Mr. Alan Howarth.

Question accordingly negatived.

It being after Six o'clock, MR. DEPUTY SPEAKER proceeded, pursuant to the Order [6 February] and the Resolution yesterday, to put forthwith the Question on an amendment moved by a Member of the Government up to the end of clause 9.

Amendment made: No. 27, in page 9, line 28, after `Council', insert—
the Historic Buildings and Monuments Commission for England'.—[Mr. Howard.]

Orders of the Day — Part II

WATER SUPPLY AND SEWERAGE SERVICES

Dr. John Cunningham: I beg to move amendment No. 1, in page 9, line 30, leave out part II of the Bill.

Mr. Deputy Speaker: With this it will be convenient to take the following amendments: No. 102, in clause 10, page 9, line 36" after 'Chapter', insert—
'and provided that no reference to the Monopolies Commission made in accordance with section 28(2)(6) in respect of that company is outstanding.'.
No. 109, in clause 28, page 32, line 4, after second 'undertaker', insert—
'or by any nominated holding company of a successor company or any subsidiary thereof'.
No. 103, in page 32, leave out lines 15 to 23.
No. 104, in page 32, line 37, leave out subsection (5). 
No. 105, in page 33, line 1, leave out subsection (6). 
No. 106, in clause 29, page 34, line 22, after `enterprises', insert—
'(aa) shall have regard to the desirability of the ownership of water enterprises remaining under United Kingdom control and not altering in such a manner as to be prejudicial to the interests of water consumers or other industries the ownership of which is under United Kingdom control.'.
No. 107, in page 34, line 26, leave out `that principle' and insert—

`the principles contained in paragraphs (a) or (aa) above'.
No. 108, in page 34, line 29, leave out `that principle' and insert `those principles'.
Government amendments Nos. 141, 142, 94, 95 and 25. 
No. 96, in schedule 4, page 194, line 2, at end insert—

`Public access to meetings

7. In paragraph 1 of the Schedule to the Public Bodies (Admission to Meetings) Act 1960 (bodies to which Act applies in England and Wales), at the end there shall be inserted the following sub-paragraph—
(i) customer service committees established and maintained under the Water Act 1989.";

and the functions of a customer service committee shall be regarded as public functions for the purposes of that Act.".

Government amendments Nos. 31, 32 to 36 and 41.

No. 143, in clause 46, page 53, line 40, at end insert
`or to show that it was prevented from complying with its obligations under this section by frost, drought, unavoidable accident or other unavoidable cause'.

No. 144, in clause 50, page 59, line 11, at end insert
'or to show that it was prevented from complying with its obligations under this section by frost, drought, unavoidable accident or other unavoidable cause'.

No. 122, in clause 51, page 59, line 23, after 'supply', insert
'within the meaning of section 52(1A) below'.

No. 123, in clause 52, page 60, line 31, at end insert—
'(1A) No water shall be regarded as wholesome where it falls below the prevailing standard determined by the European Community in respect of Drinking Water Quality, whether or not contained within a Directive.'.

Government amendment No. 63.

No. 127, in clause 71, page 82, line 25, at end insert—
'(4A) Any arrangement made in pursuance of this section may authorise a local authority to undertake works in the relevant area and in such other place as may be incidental to the area referred to in the arrangement and where it is expedient to do so to secure the efficient discharge of the sewerage functions of any sewerage undertaker.'.

No. 128, page 83, line 11, at end insert—
'(5A) In the absence of any arrangements under this section each sewerage undertaker shall in making arrangements for the discharge of their sewerage functions invite competitive tenders for the design supervision and execution of all works of maintenance or construction within the relevant area from at least three organisations, one of which shall be the relevant authority for that area.'.

No. 131, in page 83, line 11, at end insert—
'(5B) Where arrangements have been entered into in pursuance of this section by a sewerage undertaker and a relevant authority any such arrangements may be varied or terminated by agreement between the parties thereto and in the absence of an agreement the arrangements shall be terminated by either party giving to the other at least 12 months notice of termination taking effect from 1st April following subject to the provisions set out in (a) (b) and (c) below: —

(a) the notice shall contain a Statement of Reasons explaining why termination of the arrangements proposed would benefit customers or potential customers of the sewerage undertaker
(b) either party may apply within twenty one days of receiving the notice to the Secretary of State for a review of the decision to terminate and any such notice shall not come into effect until the Secretary of State has published the outcome of the review and
(c) in carrying out the review the Secretary of State shall have regard to the benefit accruing to consumers as a result of the proposed termination and the financial consequences of termination on the parties to the arrangements.'.

No. 126, in clause 73, page 83, line 34 at end insert—


'(1A) The Director shall lay before Parliament in each year in which charges are fixed under this section a report setting out those charges together with such information as he may consider to be relevant in relation to those charges.'.

No. 148, in page 84, line 5 at end insert—
'(3A) When a water main or sewer is requisitioned or a connection is made in accordance with the provisions of this Act or section 34 of the Public Health Act 1936 the undertaker shall be entitled to charge the person or body making the requisition or requiring the connection in respect of each dwelling a sum (the connection charge) to cover the costs of any additional works required to ensure compliance with sections 37 and 67 of this Act.'.

No. 136, in clause 76, page 87, line 29 at end insert—
'(2A) Notwithstanding the generality of subsection (2) above, or of Schedule 10, regulations may not impose any right on a water undertaker or sewerage undertaker to require any person to make any payment for the connection or maintenance or repair of a water meter installed at the undertaker's request or insistence.'.

No. 125, in page 87, line 46 at end insert—
'(dd) provide for optional arrangements for payments by instalments'.

Government amendments Nos. 43 to 48.

Dr. Cunningham: Amendment No.1 is an excellent amendment and has the additional merit of being quite simply understood, even by those hon. Members who have paid only fleeting attention to the work of the Standing Committee. The effect of the amendment is to remove from the Bill the whole process of privatising the water industry.
Amendment No. 1 is part of a large group, which includes several other amendments in my name and in the names of my hon. Friends. Amendments Nos. 122 and 123 would require the Bill to include drinking water quality standards that met the provisions of the European Community directive. Amendment No. 126 is an important amendment, which would require the director general to give Parliament an annual report on pricing in the water industry. Amendment No. 125 is a small but significant proposal, which would allow people to pay their bills by instalments. Amendments Nos. 127, 128 and 131 deal with local authority sewerage agency arrange-ments.
We also have an interest in the significant amendments tabled by the hon. Member for Macclesfield (Mr. Winterton)—amendments Nos. 102 to 109—which would have important implications for references to the Monopolies and Mergers Commission and other aspects of takeovers in the water industry.
It is well known that the Labour party is totally and irrevocably opposed to the idea of privatising water—the nation's most fundamental natural resource. Privatisation has always been a bad idea, as is recognised increasingly widely. The two most comprehensive opinion surveys have been conducted by the BBC. The survey conducted by the Derek Jameson show——

Mr. Edward Leigh: Oh yes; quality stuff.

Dr. Cunningham: That is an interesting reaction. Clearly, the hon. Gentleman does not like the idea of the British people expressing their views. No doubt Mr. Jameson and his listeners will be interested to hear of the contempt expressed by Conservative Members. I am not surprised that Conservative Members do not want to hear

what happened as 36,068 people recorded their opinion, of whom 96·4 per cent. said that they were opposed to the whole idea of privatisation. More recently, on the "Open Air" programme, about 10,000 people responded, and 96 per cent. of them expressed opposition to the idea of privatising the water industry.

Mr. Howard: Is the hon. Gentleman suggesting that the Derek Jameson show will be the touchstone of the policies of any future Labour Government? Is the bold cry of the Opposition, "We offer you government by the Derek Jameson show"?

Dr. Cunningham: Of course not. I am entertained by the contempt in which Conservative Members hold the opinions of the British people and by the dismissive—[HON. MEMBERS: "No."] Conservative Members seemed to laugh contemptuously at the opinions of the British people. They may laugh on the other side of their faces before too long because, as the arrangements unfold, a significant and steady trend of opinion can be seen that is opposed to the Government's proposals.

Miss Emma Nicholson: The test of British opinion is in the ballot box, and the Conservative party is consistently returned to government by the British public. Surely the hon. Gentleman does not have the face to put forward misleading surveys by semi-qualified people broadcast on the Derek Jameson programme. Non-viable surveys are irrelevant and should form no part of a properly prepared and presented Opposition argument against the Bill.

Dr. Cunningham: If the hon. Lady prefers, I can read into the record the results of the Gallup poll, the MORI poll—[Interruption.]

Miss Nicholson: I am quoting the hon. Gentleman's figure of 96 per cent.

Dr. Cunningham: All the other opinion polls, too, show a trend against the Government. I agree that it is slightly smaller, being in the mid-70s. Is the hon. Lady saying that she is content with 76 per cent. opposition to the Government's proposals?

Mr. Alistair Burt: rose——

Dr. Cunningham: I shall give way in a moment; I have given way twice already.
It is well established that British public opinion is implacably opposed to the idea that the nation's most fundamental essential resource should be a matter of profit-taking by private enterprise monopolies. I believe that the public will remain opposed to that proposal.

Mr. Burt: rose——

Dr. Cunningham: I shall give way in a moment.
In almost 19 years in the House, I have never seen so much adverse press and public condemnation of a proposal. No doubt we shall hear that leading articles and editorials in the Financial Times, The Guardian, The Independent and The Daily Telegraph do not matter either. However, we believe that those and other newspapers are expressing genuine concern about, and in some cases are showing outright opposition to, the implications of the proposals. The Guardian showed its concern in an editorial headed, "Wet and worrying." I do not know whether the


Minister would describe himself as wet in the political sense—certainly not. He is, however, in a certain amount of deep water on this issue.
The Times had the heading, "Flotation is heading into deeper water"; The Independent, "The wrong way to sell water"; the Daily Mail, "Why water charges are overflowing"; the Financial Times, "Water sale in a muddle"; The Daily Telegraph, "Privatisation water torture"; and The Observer, "Risk of drowning in water sell-off'.—[Interruption.] They are all very recent.
The Financial Times said "Costly water, rotten eggs". That is absolutely ringing condemnation of the very idea of privatising the nation's water resources.

Mr. Burt: All this is very amusing, and I take the hon. Gentleman's point. It is amusing, because it reminds the House of the Opposition's reliance on ephemeral opinion. Will he think back to the considerable opposition at the time of the introduction of the measures to privatise the telephone service and British Gas and to deregulate the buses, which at the time brought tremendous opposition in much the same way as the hon. Gentleman has described? However, their success has now been proved. Does the hon. Gentleman not agree that that will happen with this measure?

Dr. Cunningham: That is a matter of opinion. I would not say that the majority of people think that the privatisation of the telephone service was a wonderful success, or some of the other inadequate privatisations. People in the rural area that I represent do not consider that bus deregulation has been a roaring success, because they do not have a bus service any more. That is hardly success for those people. That is typical of what has happened in the rural areas. The suggestion of this being some kind of ephemeral public opinion is, too, a matter of opinion and remains to be seen. However, the evidence over the past two years has been that the public are implacably opposed to the idea.

Mr. Mullin: Does my hon. Friend recall that, when it was said in Committee that 96 per cent. of more than 30,000 people who telephoned a radio show were against privatisation, the hon. Member for Bury, North (Mr. Burt) was overheard to remark that, if that was calculated on the same basis as under the Housing Act, it would constitute a majority in favour?

Dr. Cunningham: It would be typical of the Government and their supporters to construe something like that as a victory rather than a defeat. Indeed, on the basis of some of their earlier legislation, that might be their intention.
Privatisation has little, if any, support outside the House. I do not believe either that it has an honest majority in favour inside the House.

Mr. Burt: What does that mean?

Dr. Cunningham: It means that there is a whipped, arm-twisted, bullied and cajoled majority for it. [Interruption.] I shall tell the hon. Member for Penrith and The Border (Mr. Maclean) that I would be happy to have a free vote on the issue, but would he? Of course he would not. I suggest that, before he makes sedentary interventions like that again, he thinks about the implications of what he is saying.

Mr. Peter Thurnham: The free vote that matters is that of the electors at the polling stations. If the hon. Gentleman is paying so much attention to what the papers and opinion polls say, he should know that they have always said that they would much rather have this Government in charge of the country's affairs. The reason why the Opposition were thrown out of government in 1979 was their completely inefficient management of the economy—including the water industry, where investment was cut by one third.

Dr. Cunningham: It is a blinding statement of the obvious that the Conservative party won the last general election. However, I do not believe that such issues as water privatisation and the sell-off of our national parks played a significant part in that general election. I wish they had. However, they will play a significant part in the next general election, and they will not be helpful to the hon. Gentleman's cause.

Mr. Knapman: rose——

Dr. Cunningham: I shall not give way for the moment.
The public are already paying an unnecessary and heavy price for this dogma-driven idiocy, as the recent increases imposed by the statutory water companies have made clear. The Minister of State has huffed, puffed, bellowed and cajoled about the matter. He said that he could not see any reason why consumers should pay more than a 10 per cent. increase in the coming financial year. We always believed that that was nonsense. I remember his right hon. Friend the Secretary of State saying during Second Reading that our predictions about the effect of this on prices were "absolute nonsense".
Within months, our arguments have been proved right and those of the Secretary of State proved wrong. The forlorn and bedraggled attempts of the Minister of State to resurrect the Government's credibility from the fiasco— not to protect the public—have come to naught. He has tried to make a virtue of the fact that the average price increase for 12 million consumers will be 22 per cent. in the coming financial year.
The Minister of State looks somewhat puzzled. He looks as though all this is new to him. An increase of 22 per cent. is three times the rate of inflation. There has been an attempt to present this debacle of policy as a great victory for consumers.

Mr. Howard: rose——

Dr. Cunningham: I shall give way in a moment.
I wrote to the right hon. Lady the Prime Minister about the connection between privatisation and increased charges. The Secretary of State got into a bit of a lather today and said that what I was saying in that letter was not true. I was, however, quoting the West Kent water company. The management of that statutory company —one of those paragons of rectitude often paraded from the other side of the House as role models for how to manage the water industry—told every one of its consumers that a 21p in the pound increase was being dunned on them as a direct consequence of the Government's privatisation proposals.

Mr. Howard: Does the hon. Gentleman not recognise that that reinforces the need for the regulatory structure that we are providing in the Bill? Does he not recognize


that those companies operate under an out-of-date system, with inadequate regulation that was untouched by the Opposition when they were in power?

Dr. Cunningham: Yes, of course it was untouched, because those companies were not levying increases of 42 per cent. For the Minister of State to propose that private enterprise is necessary for the regulation of prices is the most incredibly stupid argument for the market that I have ever heard. To say that we must have private enterprise so that we can have price controlsis economic illiteracy. As an act of kindness to the Minister, I suggest that he would do far better to keep his head down and keep quiet about this.
I have the Daily Mail with me, which is the most implacably loyal supporter of the Conservative Government through thick and thin whatever happens, but it says of the Minister of State and his huffing and puffing and bluster about price increases:
Ministerial anger over this is bluster and humbug.

Mr. Howard: Never mind what the Daily Mail says; does the hon. Gentleman appreciate that, if one has monopolies in the private sector, they should be properly regulated? Part of that proper regulation should be price control of precisely the kind that we shall put in place as a result of the Bill's provisions.

Dr. Cunningham: But the point is that we should not have private monopolies in the first place. What is the possible justification for leaving consumers to the mercy of private, cosseted, protected monopoly power?

Miss Emma Nicholson: rose——

Dr. Cunningham: No, I shall not give way.
We shall be faced with private monopolies with unprecedented powers in the British economy, from which consumers will have no escape. They will have no choice, unless, of course, they take the advice of the Secretary of State who said, "Yes of course they have a choice—they can buy Perrier." I cannot see people in Durham watering their leeks with Perrier or washing their greyhounds in it or anybody bathing their grandma in it. Of course consumers have no choice; the Minister knows that full well. Public Finance and Accountancy of 17 March was right to describe privatisation—I forgive it the pun—in this way:
Sluice gates open for water charges.
That is the consequence for consumers of the Government's proposals and the Minister knows it.
It is bad enough that water consumers should be taxed in this way to pay for Conservative party dogma in the face of all reasonable and reasoned arguments, but the environment too will pay a heavy price as a consequence of privatisation.
We believe that the whole idea of water privatisation is nonsense, and I believe that the public share our view. Water is inevitably a natural monopoly, essential to life, to health and to well-being. It should not be an object for profiteering. The Prime Minister's comparison between the water supply and the food industry is offensive.
People have no choice about needing water and they have no option about from where they get it, but they have all sorts of choices and options about where they can buy their food—they can even grow it themselves. It is insulting to millions of people throughout the country to say that the things are the same and that therefore there is

a case for making water the subject of profit taking and private monopoly powers. The private monopolies will not face any market forces, and there will be no competition in the sense that people talk about private enterprise creating such competition. There will be no private enterprise, because the private monopoly will be protected from the market simply because no market will exist.
The Government's notion of comparative competition is a half-baked idea which has been dreamed up to try to give the privatisation some cloak of respectability, but no one has any difficulty in seeing through it.

Mr. Nicholas Baker: The hon. Gentleman has spoken about private monopoly. Why then did the Labour Government do nothing about the statutory private water companies from which I and many other people draw their water supply? Their prices were not controlled by the Labour Government, but the hon. Gentleman appeared to suggest that those prices were not put up enough. How does he suggest that a Labour Government would get the required investment? In Committee, he accepted that a large amount of new investment is necessary, but who would he get to pay for it?

Dr. Cunningham: I do not want to be discourteous to the hon. Gentleman, but his compendium interventions with multiple questions are difficult to answer in total. I do not like Conservative Members' allusions to "private" water companies. They are not private enterprise water companies, but statutory, regulated water companies. We did not do anything about them—to paraphrase what the hon. Gentleman has said—because we did not believe there was a significant problem. They supply about 25 per cent. of consumers and, in the circumstances that then prevailed, they did a reasonable job.
The hon. Gentleman is aware that I recognise that major investment is required to improve drinking water quality, to protect and enhance the environment and to eliminate pollution. The hon. Gentleman was upstairs with us for weeks on end, and he knows that there was no argument about that. The argument is whether such improvements are best controlled, directed and planned as part of a national policy, which is open and accountable, with national objectives under Government and public control, or whether it is better done by private enterprise monopoly power exercised in secret, with the public having little or no impact on the matter. In that case, the public would have little say in what happens and nowhere else from which to receive their water. There is a wide gulf of opinion about the way in which such things are managed, but there is no argument about the need for investment.
We believe that we are far more likely to achieve sustained, coherent, strategically planned and coordinated investment if such matters are subject to public policy rather than to private enterprise policy. That is the great political difference between the opposition parties and those who support the Bill. I am sorry that I rehearsed all of that again at some length, but——

Mr. Howard: Was it part of such a coherent, planned strategic policy that investment in sewerage was cut by 50 per cent. by the previous Labour Government?

Dr. Cunningham: We had numerous exchanges about this in Committee. I read the figures into the record last


night. Total capital investment in the water industry during the Labour Government's period of office was, on a yearly average, higher than the yearly average during the nine years of this Government's office. That investment was made in different economic circumstances. Expenditure was not cut and the Minister need only look at the water statistics published by the Water Authorities Association to see that.

Mr. Howard: The hon. Gentleman has not answered the question.

Dr. Cunningham: That does answer the question. The hon. and learned Gentleman is wrong.

Mr. Howard: rose——

Dr. Cunningham: I have given way to the Minister three or four times.

Mr. Howard: The hon. Gentleman has not answered the question.

Dr. Cunningham: I have answered the question, and I will not give way again. The Minister can no doubt use different figures to try to prove his point. I am talking about total capital investment over a five-year period in the water industry.
6.30 pm
The Government have argued that, by passing the nation's water resources into the hands of protected private monopolies, efficiency will improve. Let us test that claim. The arguments for the market and for private enterprise have been that competition and market forces —the need to be in the lead, and the challenge of other providers of goods and services—drive efficiency. None of those will exist in the circumstances that the Government are creating in this case. That is clear beyond doubt, so none of the alleged creators of efficiency in a free market will impinge on the private water monopolies. The Government claim does not stand up.
It is argued that water authorities will not only be able to borrow freely but that they will invest more when they are privatised. In fact, it is cheaper for the regional water authorities to borrow from the national loans fund than it will he for them to borrow in the open market. Immediately, therefore, it will he more expensive for them to borrow to finance their investment.
The Secretary of State has said, not once but often, that these protected private monopolies will be given immunity from prosecution if they pollute the environment. Hence, pressure on them to invest and improve and be more protective of the environment is being knocked away before they even exist. From where will the efficiency come? How will there be a drive for greater investment? What will direct, control and motivate all of that?
These protected private monopolies will face a dilemma. They will have to keep their shareholders and investors happy and achieve the necessary returns and dividends, and pay the directors' fees and all the other paraphernalia of additional expense, and at the same time invest in long-term matters of environmental protection and pollution control, on which the pay-back periods will stretch far into the future. We think we know where their final choice will rest. It will be to keep their shareholders happy and pay dividends at the expense of consumers and at the expense of investment to protect the environment.
It is argued that the new system of regulation will protect consumers, but the director general will have no part in the initial price-fixing, and it will take at least 10 years for his system to have any significant effect. Privatisation, it is argued, will release the industry from political control. Yet the Secretary of State will fix the original prices, and thereafter they may be reviewed after five years.
The Government will try to palm off the shares to a few million people whom they believe will want to take them up. I do not think there will be a very positive response to a flotation of the water industry, because people already see the difficulties and contradictions in the Government's position. The privatisation proposals in the Bill are a triumph of ideology over reason and common sense. They are costly, messy and deeply unattractive proposals.
It has been suggested that involved in all this is the selling off of public assets worth about £27 billion—assets built up over years out of the rates and public investment —for between £5 billion and £7 billion. That sale will be challenged in the courts by a number of local authorities, and understandably so. That is another negative factor for the flotation, if it ever reaches that stage.
We are seeing a great deal of public investment and assets being sold at a knock-down price. I have said many times that much of our priceless natural heritage and environment is being sold off in this way. I defy the Minister to tell me of any other national Government of any political persuasion who are putting large tracts of their national parks on the market, up for grabs. It is not happening in the United States, in the Federal Republic of Germany or in Scandinavia, France, Portugal, Spain or anywhere other than in Britain. That fact is deeply offensive to millions of people who are horrified at the prospect.
We believe that the Government are proposing to ease this privatisation by writing off £2 billion to £3 billion of the total accrued debt of the industry, which is standing now at about £5·2 billion. We believe that they intend just to write it off. It will be another huge cost to the taxpayer. It is happening almost without a word. Indeed, I do not recall one word of protest by Conservative Members when that matter has been discussed. Do Conservative Members call that protecting the interests of the taxpayer? They have been silent on this issue, as they are now.
It has become an accepted fact of life that privatisation and Government dogma is enough justification for these huge write-offs to take place at the public expense, and apparently another one is on the way. That will be necessary to give the industry some semblance of the sensible capital structure that it will need to be even remotely attractive to investors.
Adding debt to relatively debt-free companies, such as Thames Water, to create the level playing field necessary to maintain the charade of competition is apparently to be another facet of all this. It means that customers of Thames Water, whose charges over the years have funded investment rather than it being financed through borrowing, will have to pay again. Thames Water consumers will have an additional tax placed on them. They will be allocated some debt. That will be their prize for privatisation. They do not have much debt now, but they will be given some. There is no real justification for that action. The justification is simply the Government's dogma-driven ideology, and that is the only reason why the Bill remains before the House in its present form.
The proposals are about guaranteeing a rate of profit to the industry to ensure that investments are made, irrespective of whether any commercial risks are involved and irrespective of management competence. We cannot get much further from market forces and private enterprise. That is a signal feature of what Ministers are asking the House to accept. We are to have increasing prices to finance profit, dividend, corporation tax and investment up front rather than ensuring that the generators who benefit will have to pay.
The Government's proposals are about the creation of cosseted, protected private monopoly power over captive consumers on a scale and of a nature unprecedented in Britain. There is to be immunity from prosecution and from market forces. These bodies will be protected even against takeovers for the first few years of their existence, regardless of competence and performance. In 19 years in the House I have never seen such a miserable, pathetic collection of incoherent proposals. If it has any sense, the House will throw them out now.

Mr. Nicholas Winterton: I am grateful, Mr. Speaker. I appreciate the importance of the delay before you called me to participate in the debate.
I intend to support the Opposition on amendment No. 1. I see it as my duty as a Back Bencher to seek to improve a fundamentally flawed, unpopular and unnecessary Bill. One way of improving it would be to leave out part II. That has been dealt with adequately by the hon. Member for Copeland (Dr. Cunningham).
I wish to direct my remarks to other amendments. The purpose of amendment No. 102 is to prevent an appointment being made to a new plc where a reference is outstanding to the Monopolies and Mergers Commission. I am widely supported in my view that we should introduce a pause while the MMC reports on mergers which are in progress after 11 January this year and before the new companies are appointed as undertakers.
Amendments Nos. 103, 104 and 105 have an important purpose. They would delete the provision for, and all references to, the asset limit of £30 million below which references to the MMC are not made automatically. Since all water undertakings are monopolies, as has been pointed out already in the debate, it should make no difference in principle whether a company is large or small when determining the reasons for a referral to the MMC.
Amendments Nos. 106, 107 and 108 also have an important purpose. They would add to the duty of the MMC to examine a merger in the light of its impact on comparative competition an equal duty to examine it in the light of its impact on the interests of consumers or other industries. Amendment No. 109, which might be described as an optional amendment, would have the effect of ring-fencing the assets of the industry at transfer for the purpose of a reference to the MMC.
Privatisation of the water industry will place in private hands the 10 regional monopolies that dominate the industry. The 100 per cent. of consumers whose sewerage services are provided by water authorities, and the 75 per cent. of consumers whose water is supplied by them, are to join the 25 per cent. of water consumers presently supplied by private water companies. All consumers, whether currently supplied by water authorities or by the statutory water companies, will have supplies regulated on a

different basis from that which obtains at present. All consumers have an interest in the Bill. I seek on this side of the House to represent the genuine concern and confusion of people up and down the country who are deeply worried about the Bill and its implications.
The Bill will transform an industry which is a vital component of everyday life. All consumers, therefore, have an interest in seeing that the Bill is made right. That is what I am seeking to do at this late stage. There is much in the Bill which seeks to protect the interests of consumers —price controls, environmental controls and regulation by the Director General of Water Services. In the long term, it is the control imposed upon the creation and ownership of the monopolies which comprise the industry that will underpin the system and perhaps dictate whether the legislation—if it ever reaches the statute book—is a success.
That control will determine the general approach that the monopolies take to business. It is intended to ensure that companies interested only in exploiting the potential position of monopolies to increase prices while cutting the quantity and quality of services, rather than those interested in providing a genuinely effective and efficient service, are kept out of the industry. That is the purpose of some of the amendments. It is thus essential that the parts of the Bill dealing with the acquisition and extension of monopoly powers are got right in the House. It is because of fears that the Bill as it stands has not got it right that I have tabled the amendments.
6.45 pm
My amendments would have three effects. First, the Secretary of State would be required to refer to the Monopolies and Mergers Commission all takeovers and mergers in the industry rather than just those involving companies with water or sewerage assets in excess of £30 million. Secondly, the companies which would be deemed relevant for the purpose of such a referral would include all those which develop out of the industry as it currently stands, not just those which are water and sewerage undertakers.
Thirdly, and most important, the amendments would require the Monopolies and Mergers Commission to have an equal regard for the interests of consumers and for other parts of the wider economy, as it would have to be used to maintain the system of comparative competition when making a recommendation on any case referred to it by the Secretary of State.
The questions giving rise to the amendments were touched on briefly in Committee. At its 29th sitting, and at the end of the day, the Standing Committee found time to spend just 45 minutes discussing these issues. Because of the briefness and inconclusiveness of that discussion, the matter requires an airing before the full House. Without such an airing, the chance to put right a fundamental omission from the Bill, which would have serious and unwarranted long-term consequences, would be lost.
The first matter is relatively straightforward. Amendments Nos. 103, 104 and 105 propose the removal of the exemption on referrals of takeovers and mergers where the relevant assets of either company are under £30 million. The Bill already embodies a concession: if the assets of either company involved, rather than those of the object of the bid, exceed £30 million, a referral is automatic. That concession is warmly welcomed. My amendments propose to take the matter to its logical


conclusion and extend to all consumers the protection that investigation of bids and mergers by the MMC is supposed to afford.
The need for such protection is already evinced by the Bill—hence the requirement for referral where assets exceed £30 million. It is already admitted that the possession of monopoly powers involves such risks to consumers that their investigation is warranted by referral. Yet for those whose water is provided by statutory water companies with assets of less than £30 million there will be no automatic protection.
The Parliamentary Under-Secretary of State and other Ministers have defended the position by saying that the operation of comparative competition, whatever that might be, will give consumers all the protection that they need. I ask my hon. and learned Friend whether that assurance can be relied upon. Comparative competition is a relatively new concept—untested and untried except in the local authority sector, with which the water industry is not comparable. Further, it is to be operated by a directorate staffed by only 80 people. That is hardly a sufficient complement to police 39 companies, given the other duties that the directorate has. In any case, were it to operate effectively, the customers of those companies would still be afforded less protection than those of other companies. Yet the last two years suggest that it is these customers who are, in fact, in need of protection, for it is the smaller statutory water companies that have been the object of the most sustained interest from what I can describe only as foreign predators. Surely it is in precisely those circumstances that the protection afforded by an MMC investigation is most needed, since foreign predators are those about whose track record and intention the least is known in this country.
I hope that my hon. Friend will accept the validity of what I am saying, particularly in the light of evidence that I have about the extent of French interest in the water industry of this country—the French having bought into some 16 of the private water companies already, and having increased the value of their shareholding dramatically.

Miss Emma Nicholson: rose——

Mr. Winterton: I shall give way in a moment. I suspect that I shall be tempting the right hon. Lady—I should say the hon. Lady, though perhaps it is only a matter of time —in a few moments.
The second matter—that of extending the investigatory role of the MMCs to the entire industry as it currently exists, rather than just to the water and sewerage subsidies of successor holding companies following privatisation —may be less straightforward, but in my view it is no less necessary. Throughout the discussion of this Bill—indeed, since it was first mooted back in 1986—there has been much public concern about what will happen to the assets of the industry. We are not talking just about the distribution and supply of water, or about effluent disposal, but about an industry that has immense, rich assets, which were built up over many decades, being paid for by ratepayers and users of the services throughout the country. They now total between 400,000 acres and 500,000 acres, much of which is not, strictly speaking, necessary for operational purposes and, as the Bill stands, will in many cases be outside public scrutiny after privatisation. There will be nothing to stop unscrupulous

predators—by which, of course, I mean the French, among others—from taking over part of the industry and, while giving a perfectly good account of themselves so far as the water and sewerage undertakings are concerned, will use their acquisitions as an excuse to asset-strip other companies in the groups to which the undertakers belong.
The rights of access and the leisure and recreational facilities that have been developed over many years will, in my view, be severely jeopardised. I speak with a deep interest, as there are in my own area of Macclesfield many hundreds of acres, owned by the North West water authority, which are widely used by the people of my constituency and—yes—by the people of Greater Manchester as well, for recreation and leisure.

Sir Anthony Grant: rose——

Mr. Winterton: I will give way in a moment.
I am deeply concerned, despite some of the assurances that my hon. and learned Friend the Minister gave in earlier debates both in Committee and on the Floor of the House. I should say that in my view no Minister in Her Majesty's Government could more adequately, competently and intelligently promote the Bill—I have said that publicly—but the problem is that my hon. and learned Friend can present a good case only when there is a case to put. In this instance, there is no case whatsoever. That is perhaps a backhanded compliment, but it is intended very sincerely none the less.

Sir Anthony Grant: On the point that my hon. Friend made so powerfully, I know his area and I know how beautiful some parts of it are. Does he agree, however, that there is a body—presumably known as the Macclesfield planning authority, or something similar—which no doubt shares his views and has the power to preserve the beauty of that amenity?

Mr. Winterton: I shall be coming to that in a moment, but I will tell my hon. Friend now that I do not believe that the local planning authority has the necessary power to ensure that that land is not exploited or developed in ways which are undesirable to the area and are certainly not in the interests of conservation or the environment. In my view, the rights of access and the leisure and recreation facilities that have been developed over the years will be jeopardised.
Nor is this just a fear of the more unusual groups— those whom many of my hon. Friends would describe as the bearded weekend ramblers—[Interruption.] I make that point merely to strengthen the views that I am expressing.

Mr. Knapman: My hon. Friend may rest assured that the bearded ramblers in the Opposition ramble only when they are speaking.

Mr. Winterton: I am glad that my hon. Friend did not accuse me of rambling.
That fear is shared by many organisations. One of them is the National Trust, of which I am a member. Dare I say that it is shared also by the Country Landowners Association—not a notoriously Socialist-oriented body —and the Countryside Commission? The amendment would subject to the scrutiny of the Monopolies and


Mergers Commission the takeover of any assets currently within the water industry and would thus afford protection against those fears being realised.
The third and final matter—that of extending the remit of the MMC's investigation to include consideration of the effect of mergers and takeovers on consumers and on other parts of the economy—is perhaps the most important point covered by this group of amendments. As the Bill currently stands, cases referred to the Monopolies and Mergers Commission are investigated by it in the light of the usual remit of potential detriment to the public interest.
Above and beyond that remit will be a duty to examine the impact of a merger or takeover on the operation of comparative competition. That consideration stands above all others. That provision is, however, naive. It results from a blinkered view of how the industry may develop and what its links with other sectors of the economy are. Comparative competition may be well and good in theory but, as has been made clear, it is untried and untested in any comparable industry in this country. In theory it would provide a check on the abuse of monopoly power—but only in theory. It is in the nature of natural monopoly that one cannot be sure of the counterfactualisation against which it is to be measured. Comparing one natural monopoly with another can guarantee only that neither abuses its position more than the other; it cannot guarantee that abuse does not take place. [Interruption.] It is therefore illogical to make the maintenance of comparative competition a primary consideration to the exclusion of all others.

Mr. Nicholas Bennett: Will my hon. Friend give way?

Mr. Winterton: My hon. Friend should perhaps show a little more respect to one who has been in the House rather longer than he. This happens to be a very technical matter, and if I am referring to notes rather more frequently than I should, it is because I want to get it right. I can only say that I believe that in this instance I am reflecting the views of a dammed sight more people than he is.

Mr. Bennett: Will my hon. Friend give way?

Mr. Winterton: I will give way when I have finished this paragraph.
The first purpose of the amendment, therefore, is to give equal importance to the examination of consumer interests. I trust that we on the Conservative side of the House are interested in consumer interests. [Interruption.] I will give way in a moment. It is entirely correct that the MMC should take an inside view of the industry, but it needs also to take an outside view.

Mr. Bennett: Can my hon. Friend tell me first what he put in his own election address in 1987, when water privatisation was a clear commitment in the Conservative manifesto? What did he tell his electors then? Secondly, what is the role of the Director General of Water Services?

Mr. Winterton: The subject did not appear anywhere in my election address.

Mr. Bennett: Is that why the hon. Gentleman's majority went down?

Mr. Winterton: My majority is satisfactory—[Interruption.]

Mr. Bennett: rose—

7pm

Mr. Winterton: No, I will not give way on a trivial, pathetic point which should not feature as part of this important debate. I only hope that my hon. Friend will continue to enjoy any kind of majority in his constituency.

Miss Emma Nicholson: I am concerned about the position of the Macclesfield planning authority. I invite my hon. Friend to put forward his plans for new, revolutionary and even more democratic planning authorities. I do not know where he expects planning decisions to be made. Personally, I believe that they should be made as close as possible to the people who will suffer the effects. I am delighted to have two outstanding planning authorities in my constituency—Torridge and West Devon. In addition, we have the Dartmoor national park committee. I do not imagine that it will be better to pluck those decisions away and to have them made here or by the parish council, the county council or even, for example, by Macclesfield town council. I am confused—[Interruption.] I wonder whether the hon. Gentleman, with his keen and burning interest in the Bill, was here last night to hear the splendid amendments that were tabled and accepted by the Government and by my hon. and learned Friend the Minister, whose virtues the hon. Gentleman has so adequately lauded. Those amendments have been accepted. I believe that the hon. Gentleman fusses too much.

Mr. Winterton: There are times when I should not give way and that was undoubtedly one of them.
Without such a view being taken, situations could arise in which companies may buy their way into the industry at no damage to the operation of comparative competition, but at considerable risk to consumers. A management with aims other than that of providing a public service at a reasonable rate of return may take over the industry. Performance would still be competitive, but it would also be worsened. In the long term, the director general's exercise of his powers could—perhaps even would—restore the situation, but in the short term a continual see-saw would be created in which standards would alternatively rise and fall.
The task of the director general—this was one of the questions asked by the hon. Member for Pembroke (Mr. Bennett)—would become like the economist's pursuit of equilibrium. It would always be aimed at, but never achieved. Therefore, just as the economist goes for the pursuit of "second best", knowing that the holistic benefit is greater than that of equilibrium, so the remit of the MMC must be shaped with an acceptance that the market is not in a perfect state. By giving the MMC an equal duty to examine the impact of mergers and takeovers on the consumer interest, that can be achieved. That would prevent the entry of firms which have no track record in the industry, or those whose track record was poor. It would change the remit from one in which there was a presumption in favour of entry—on the assumption that if problems arose the director general could put them right afterwards—to one where there was a presumption against entry unless it could be shown that problems would be


unlikely to arise in the first place. In many industries this would be unnecessary, but in one so vital to public health it is not the case.
Firms which may have a tougher attitude to disconnections or which may be lax about health and safety or unused to the market in England and Wales should be weeded out before they are allowed to cause problems. It will be no consolation to consumers who may otherwise be adversely affected that the director general, in whom so many people seem to put so much trust, will have the power to close the stable door after the horse has bolted.

Mr. Tim Boswell: My hon. Friend has been making a most eloquent case but it seems that, whether he intends to or not, he is directing his case almost entirely to the one moment of consideration in advance of clearance. Surely he agrees that it is better to have the continuing regulation of the director general and the safeguards established under the Bill for the continuing conduct of the privatised authorities than to have one moment or gateway in which the Monopolies and Mergers Commission could be invited to speculate on some hypothetical future conduct of a privatised water undertaking.

Mr. Winterton: I am not unsympathetic to the views that my hon. Friend has just advanced. My amendments go along with that. There is an ongoing role for the director general in just the way that my hon. Friend has described. I am trying to ensure that we do not allow undesirable companies into the industry in the first place. That is the reason for some of the amendments to which I am referring.
There is, however, a second reason for amending the remit of the MMC—to give it a duty to have regard to the impact of mergers and takeovers on other sectors of the economy. For such a requirement to be made explicit may seem unusual, but it is a measure of the extent to which one needs to be on one's guard. The past 18 months have seen an unusual flurry of takeover activity among the statutory water companies. The French have been buying in and paying up to 10 times the market capitalisation for companies whose financial performance has always, to say the least, been a little predictable.
One has to ask, and I do ask my hon. and learned Friend the Minister, why that is so. It cannot simply be because those companies see an opening to increase prices and thus increase profitability. That is part of the story, as the statutory companies average price increase of 22 per cent. shows, but the high prices paid for the companies suggests that that is not the whole story.
One does not have to search far to find the other reasons for those takeovers. It is by now widely realised that the water industry is asset-rich but cash-hungry. Indeed, my hon. and learned Friend the Minister has said so himself on several occasions. It has many non-operational assets which could be sold off and many which, though operational, could be simultaneously developed to purchase additional profits. In Standing Committee the Minister said that that should cause no problems for consumers, and that the normal planning process would guard against unwanted development, but assurance requires concrete form. It should be incumbent upon the MMC to weed out what I can only describe as the asset-strippers. My right hon. Friend Lord Young and the

Government did that recently in respect of Elders IXL and Scottish and Newcastle Breweries. I hope that they can do the same again in the future.
Beyond that, the French firms pose a further threat that we must guard against. As my hon. and learned Friend the Minister knows all too well, those firms are not only—or even primarily—water and sewerage undertakers. Their subsidiaries cover chemicals, construction and civil engineering. What is more—I say this especially to Opposition Members —they cover many functions cur-rently performed by local authorities, but which are shortly to be put out to tender in the compulsory tendering process. It is those areas on which the French have their eye as much as on the water industry. In the run-up to 1992 they will expand into civil engineering and municipal services.

Mr. James Pawsey: rose——

Mr. Winterton: I will give way in a moment.
That may not necessarily be a bad thing and to some extent it is inevitable, but it must be guarded against lest we end up with markets handed over to French cartels interested in promoting uncompetitive practices for their own sole and exclusive benefit.

Mr. Leigh: That is pathetic.

Mr. Winterton: It is not pathetic—it is a real threat to this country. It could be well outside the remit of the director general, to whom reference has already been made several times, to examine the issue. It should therefore rightly be the duty of the MMC to consider it.

Mr. Hawkins: rose——

Mr. Winterton: I will give way to my hon. Friend the Member for High Peak (Mr. Hawkins), who is my neighbour and my colleague.

Mr. Hawkins: I put this kindly to my hon. Friend, to whom I am grateful for giving way. I believe that he is giving an impression that he would not wish to give in saying that French firms are building a bridgehead here and when he talks about "undesirable investors". British firms are building a bridgehead in Europe for 1992. Can my hon. Friend say how the Monopolies and Mergers Commission would define "undesirable investors" in a water company if the people concerned were obeying the law of the land? I do not believe that my hon. Friend wants to give the impression that the French are unwelcome. The Perrier company bought Buxton Water in my con-stituency, and transformed it into a household name. I greatly welcome that.

Mr. Winterton: It is sad that Buxton Water was unable to make itself a household name when it was independent —[Interruption.] It was in our household, among others. I trust, however, that I am not giving the House the impression that my hon. Friend sought to imply by his intervention. I am concerned that, unlike British firms which buy companies in America openly and honourably for the purpose for which they exist, the French seek to come here and take advantage in other ways, by the back door. The Minister understands what I am saying. Rightly or wrongly, the people of this country are sincerely worried about that.
The amendments are designed to give teeth to the controls which will be placed on the industry after


privatisation. I am not trying to destroy the Bill but to put meaningful, rational controls on it so that if it proceeds to the statute book it will provide the correct solutions. Controls may seem contrary to the concept of bringing market forces to bear on state-owned utilities, but it is not market forces which are being brought to bear on the water industry. It is private monopoly forces—precisely those which encourage bad practice and inefficiency.

Mr. Barry Porter: rose——

Mr. Winterton: I shall not give way because I am about to sit down.
It is amazing that the Government, who worship at the door of Adam Smith, are doing precisely what he advised against—exchanging a public monopoly for a private monopoly. He did not believe that it would work, and neither do I. The electorate are well aware of that. Strong controls of the kind that I have proposed must be put in place to convince the public that the Bill is not an ideological measure with no regard for their interests.
I hope that my hon. and learned Friend the Minister will seek to respond to my speech, not to destroy the Bill, but to make it better so that when the Conservative party comes to fight the general election in 1991 it will not be faced with the dire consequences of the Bill, but the legislation will be in force and working properly. That will happen only if the kind of proposals that I have put to the House today are incorporated in the Bill.

Mr. Deputy Speaker (Mr. Harold Walker): Order. Obviously, many hon. Members wish to take part in this debate. I should remind the House that the debate is guillotined and that long speeches are made only at the expense of other speakers.

Mr. Eric S. Heller: I certainly do not want to make a long speech. I wish to draw to the attention of the House the fact that a document has arrived in my hands called "Supplement to The Engineer", dated 15 July 1892. The document is about Lake Vyrnwy and the Vyrnwy water supply to Liverpool, which was inaugurated on 14 July 1892 by His Royal Highness the Duke of Connaught. It contains an article by George F. Deacon, M. Inst. C.E. Engineer.
I draw the House's attention to this document because on 14 July 1892 Lake Vyrnwy was handed over to Liverpool city council's water committee, which was a publicly owned body. Incidentally, Lake Vyrnwy is still one of the main water supplies to Liverpool. The article states:
During the last census period the rate of increase in population
—in Liverpool—
was not quite so great as in the immediately preceding decades, but no less than 518,000 people within the city boundaries and 801,000 people within the area of distribution are now supplied with water by the Corporation of Liverpool. Such a population will, at the rate of, say, 30 gallons per head, require over 24,000,000 gallons per day, and to meet this demand the existing and extensive water supply works have become insufficient.
The article then explains why the supply should be extended.
I considered the document carefully and discovered that Liverpool city council, in relation to water supplies, goes back even further than 1892. The first Act of Parliament was in 1847. This is all about public ownership. When did that public ownership fail the people of Liverpool in regard to their water supply? People in Liverpool, including Conservative city councillors, have never argued that the Liverpool water supply was not good enough and ought to be privatised. That is a figment of the imagination of the Secretary of State for the Environment and the Minister who, for some reason, have developed a crackpot idea in their heads that they ought to introduce water privatisation even when there is no demand for it among the people who are perfectly satisfied with the present water supply and who have been quite happy for local authorities—mainly Conservative controlled since 1847—to supply Liverpool's water. I do not understand what this Government are about, except that they want to get hold of the land surrounding Lake Vyrnwy in order to sell it off at what they believe to be a profit.
I sat on the water committee in Liverpool—until I did so I did not know much about the water supply. However, I then realised the great things that have been achieved over the years, many of them absolutely magnificent. All sorts of facilities have been granted so that youngsters from Liverpool who had never seen such things could visit lakes and participate in water sports and other activities connected with the lake. What do the Government intend to do with that land—sell it off to their mates and friends? Is that what this is about? The people of Liverpool are not arguing for that.
I could continue to speak about this document, which is truly magnificent. I am glad that it came into my hands and I shall repeat the details. It is the supplement to The Engineer, dated 15 July 1892, and contains many lovely pictures depicting how water was brought to Liverpool —including the route, which was a great engineering feat——

Mr. Thurnham: I thought perhaps the hon. Gentleman would allow me to intervene, as I am an engineer myself. I am sure that, in harking back to 1892, he will find that engineering then was nothing like engineering today. Does not the Bill adapt the structure of the water supply industry to the needs of modern society, rather than try to sit with all the old-fashioned stuff? If the hon. Gentleman were an engineer, I expect that he would try to introduce engineering that was designed in 1892.

Mr. Heffer: The hon. Gentleman may be aware that I worked on construction sites all my life until I came into the House. There are engineers and engineers. For example, once when I went to do a job in an office, the office manager said to me as I was hanging a door, "Joiners are not like they used to be." I said, "How the hell do you know? Could you hang that door?" He did not know what it was about. I knew, because I was a trained carpenter and joiner. All joiners are not great; neither are all engineers.
The document that I have shows what a magnificent feat of engineering this was to Liverpool. Is the hon. Member for Bolton, North-East (Mr. Thurnham) suggesting that the engineers of that day did not do a great job? We have some of the best and purest water supplies in the whole country, and we should be proud of those engineers. They worked for Conservative city councils,


which also built the docks in Liverpool. The councillors tried to further the interests of the people of the area so that, once they had the basic services under their control, they could expand private enterprise. The hon. Member for Bolton, North-East does not seem to understand this.
Certain public services should never be privatised. As the hon. Gentleman knows, I do not agree with private ownership of many things. I accept that some can be privatised and opened up to competition, but the basic services of this country, such as water, should never be privatised. There is no rational argument for privatisation —there are only ideological arguments emanating from the likes of the hon. and learned Gentleman.

Mr. Howard: The hon. Gentleman has spoken of the drinking water that is supplied to the city of Liverpool. Is he aware that, to this day, 75 per cent. of the sewage from the city is untreated? Does he regard that as an adequate testament to the record of the public sector in this industry?

Mr. Heffer: Just because it is said that is so it does not mean that we have to privatise water. The Minister knows full well that that is a separate issue that can be dealt with separately. Over the years, the water committee on which I served asked the Government for financial support to develop the sewage works, but we never got the full support that we needed——

Dr. Cunningham: I should like to ask my hon. Friend to suggest that the Minister write to the Prime Minister to tell her that 75 per cent. of Liverpool's sewage goes out into the Irish sea untreated. She says that no untreated sewage goes into the sea around Britain. Perhaps the Minister will tell the Prime Minister that she is wrong.

Mr. Heffer: My hon. Friend knows that the Minister will not tell the Prime Minister that if he wants to keep his job for long. Saying boo to the goose leads to one being dealt with quickly——

Mr. Leigh: That is what happened to the hon. Gentleman.

Mr. Heffer: I made a principled stand on an issue, and I am not ashamed of having been sacked from a Government for doing so. Most Conservative Ministers never seem to make a principled stand on anything; it is left to Back Benchers such as the hon. Member for Macclesfield (Mr. Winterton) to do that. The day when we see a principled stand by a Minister I shall be delighted. It will give me new faith in the House of Commons and in the idea of Ministers standing up for what they believe in. However, I doubt whether it will happen.
There is no case for privatisation, and no one can argue there is. The hon. Member for Macclesfield made a first-class speech against it, and I did not disagree with most of his arguments. The Minister, with his steamroller majority, will roll the Bill through, but he had better understand that the people of this country do not want it. Whatever criticisms I may have of the way in which Labour is conducting itself, I believe that the people of this country will roll the Government over and get them out at the next general election.

Mr. Thurnham: The speech of the hon. Member for Liverpool, Walton (Mr. Heffer) harked back magnificently to all the great features of the past, of which he himself is a magnificent relic. His thinking is stuck in the past and its

great works; he does not look ahead to how we should adapt the structure of the water industry to the needs of a modern society in which one can separate the function of providing water from the function of regulating how it should be provided. That is the principle behind the Bill, and it is why I oppose the Opposition amendments and cannot support the amendments of my hon. Friend the Member for Macclesfield (Mr. Winterton).

Mr. Allan Roberts: If the purpose of the Bill is to separate the regulation of the water industry from the running of it, why is the National Rivers Authority going to sub-contract work back to the privately-owned water companies, thereby recreating the problem that the hon. Gentleman claims is being destroyed—that of the gamekeeper and the poacher being one and the same?

Mr. Thurnham: I am satisfied that the National Rivers Authority will be a well-constituted body of 6,500 employees. That does not mean to say that it will he incapable of calling on resources from anywhere that it wants. The authority will properly execute its functions and if it wants to call on the services of others, so it should. It is only dogma on the part of the Opposition that would prevent it from calling on the services of other bodies, private or public sector.
I must oppose amendments in the spirit of those tabled by the Opposition which strike at the heart of the Bill. My only criticism of the Government is that we have not been able to privatise the water industry earlier. Because we did not privatise water in our first or even second Parliament, a myth may have developed in the minds of the public that for some reason the industry could not be privatised. That is why public opinion is still showing so much inertia. Now that we are arguing that the industry can be privatised, it will take time for people to accept the idea.
I do not accept any criticism of my hon. and learned Friend the Minister or of my right hon. Friend the Secretary of State about all the work they have done on the Bill. It has been magnificent. If there is inertia in public opinion, it existed long before they came along to do the job that they are now doing.

Dr. Cunningham: First, the hon. Gentleman must have heard the Prime Minister say that the Bill has not been well presented. Secondly, there is no inertia in public opinion: it is moving steadily against the proposal.

Mr. Thurnham: Criticisms of presentation arise purely out of the ignorance, superstition and nonsense that are evident in the attitudes that we heard expressed by the relic from Walton, who is stuck in the past. If the public are fed the sort of misinformation that has come from the Opposition——

Mr. Heffer: The hon. Gentleman's past is already behind him.

Mr. Thurnham: Conservatives can look forward to the future. It is only the Opposition who worry about the past, because they have nothing to look forward to.
At the time of the outstandingly successful privatisation of the National Freight Corporation, the trade unions were so opposed to it that their Leeds branch persuaded all the employees of the corporation there to burn their applications for shares on a bonfire. I do not think that the work force in Leeds has ever forgiven the trade unions for that; it has cost them dear. That is the sort of attitude that


we are fighting on the Water Bill and it is indicative of how public opinion can be wrongly influenced by misinforma-tion from the Opposition.
It is said that we should not privatise water because it is a vital commodity. I remember that that was said about British Sugar. We were told that we could not privatise British Sugar because sugar was such a basic commodity. I have not heard anyone mention any problems about privatising British Sugar. Food and clothes are as vital as water, but we do not hear comments about privatisation in those areas. The Opposition want to ditch their clause four, but they can do that only by ditching it into a privatised drain and they do not like that idea.

Mr. Nigel Spearing: Will the hon. Gentleman give way?

Mr. Thurnham: I want to make progress.
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Before British Telecom was privatised, there were endless complaints about telephone boxes. People are now very pleased that they can use telephone boxes. British Telecom is far better now than it was in the public sector. Mercury exists as a competitor to British Telecom now. The pricing formula—RPI minus X—is working very satisfactorily for British Telecom. When we talk about RPI plus K for the water industry, we should not forget minus E where E is the efficiency factor which should work in exactly the same way as it has for British Telecom.
The hon. Member for Copeland (Dr. Cunningham) is an example of the new designer Socialist who wants to ditch what was wrong and unacceptable with Socialist policies, but is not sure where to ditch it or what he wants to pick up instead. He seems to believe that a public monopoly is all right, but he cannot accept that a private monopoly should work as well. That is the difference between us. There must be confidence in the regulatory mechanisms in the Bill which will enable the water industry to operate much more efficiently in future.

Mr. Spearing: The British Sugar Corporation was formed as a private company, although the majority of the shares were held by the public. As an engineer, will the hon. Gentleman tell us how he reacts to the idea that all the sewers—their bricks, pumping stations and filtration plants—in Bolton might be owned by a private company, which, as far as I know, and unless the Minister can deny it, can be traded and controlled on the New York, Tokyo and Johannesburg stock exchanges?

Mr. Thurnham: The thrust of the Bill is that we need more investment which clan be conducted more efficiently by the private sector, and the costs of that investment can be spread over several years.
The fundamental problem about investment in the public sector is that the Treasury seems to count current expenditure and investment as coming from one pot which must be recovered or accounted for in the year in which it occurs. I am confident that the work which needs to be done in Bolton will be better funded as resources will be available from the financial world in this country and abroad.
The key factor is that the costs can be spread over several years and funded by the workings of the RPI plus K formula rather than all the investment being recovered

in the year that it occurs. That is why investment has been so restricted in the past and why the Labour Government had to slash investment. That is why investment in the sewers and drains in Bolton was cut under the Labour Government. They did not know how to fund the industry. They were in a desperate crisis with the IMF knocking at the door, and the country was bankrupt. The Labour Government did not understand how we could gain the efficiency that we needed by spreading investment over several years and by having a management which was accountable to the people who provided the investment and which ensured an efficient return on it.
I have great confidence in the Bill. To appease public anxiety we must be very careful to set up regulatory structures which will function efficiently. The public wants to see that happen. It would be nice if we could do it step by step, because one of the fundamental improvements in the British economy has been the way in which industrial relations have been transformed through step-by-step legislation.
However, it would be impractical to have a step-by-step privatisation of the water authorities. It might be very nice to start with the North West water authority, but it would not be practical to privatise one water authority one year and another two years later. If we are going to do it, we should get on with it. As I argued at the beginning of my speech, we should have privatised water years ago. We have allowed a myth to develop that the industry is a sacred cow which cannot be privatised. However, there is every reason for getting on with privatisation.
This is complex legislation and we should not rush it. That is why the Government have taken their time to privatise the industry. I have every confidence about the way in which it is being done and in the work carried out by my hon. and learned Friend the Minister. I am sure that the Bill will reach the statute book without any more undue delays. I am sure that the public will invest their savings in this basic utility with every confidence. I am sure that those who use water and will be accountable if they pollute it will also benefit in every way possible from the Bill.

Mr. Livsey: This is a vast series of amendments, 38 as far as I can see, and they cover a huge area. I congratulate the hon. Member for Macclesfield (Mr. Winterton) on making a speech, like the hills behind Macclesfield, of true grit and determination. He put forward constructive ideas to the Minister who I hope will take note of some very constructive criticism of the Bill.
This legislation gives rise to immense questions. I support amendment No. 1 which removes part II of the Bill. That would result in no privatisation of water and would be particularly constructive.
The private monopoly which the Bill creates is inexcusable. There will be no competition as a result of the legislation. It seems that the Cabinet consists of the "Monopoly" generation. Clearly Ministers must have played too much "Monopoly" in their youth. They are obsessed with producing private monopolies under which there will be no competition.
Privatisation will increase costs as a result of the legislation's duality. Prices will inevitably rise because shareholders will have to be satisfied while consumers pay more. The need to introduce higher standards in the industry will also create massive expenditure. It appears at the moment that consumers will have to pay the lion's


share of that expenditure. Why are the Government or the Treasury not prepared to shell out some of that money to create the necessary investment to raise standards?
Mr. Collins on "Panorama" on Monday estimated the cost of privatisation to be £842 million. Who will pay that sum? Will the consumers have to pay? The argument is that the statutory water companies represent 25 per cent. of the water industry, and those companies are already in the private sector. However, that argument does not stand up when it is subjected to close examination. Those companies are regulated and statutory. I believe that the Prime Minister does not understand the basis of the statutory water companies.
The water prices in the statutory water companies have been kept low. They have been kept 25 per cent. lower than those of the water authorities because of their statutory functions. As a result of this legislation, prices will rise between 30 and 50 per cent. because the basis of the statutory water companies is being fundamentally undermined.

Mr. Porter: Missing from the hon. Gentleman's argument is any understanding that what is required in the water and sewage industry is investment, which has been lacking under Governments of both parties for the past quarter of a century. The purpose of the exercise, as I understand it, is to ensure that private capital is available. My hon. Friend the Member for Macclesfield (Mr. Winterton) reckoned that with all the regulations concerning price, quality, and the rest, the City will not be particularly attracted to investing in the new plcs. We shall see. If the City does not wish to invest, I am sure that the Treasury Bench will think again. In any event, the Bill is not about competition but about capital investment and where it can be found. It cannot be denied that investment has been unavailable from the public sector in the past.

Mr. Livsey: We all agree that investment is necessary to improve standards, but investment can be made equally well if water remains in the public sector. Yesterday, the Secretary of State himself admitted that billions of pounds must be spent to put matters right. Why has the Treasury not been prepared to sanction such expenditure, and why have the Government adhered to such policies? The Government failed to make sufficient investment in the public sector of the kind that the hon. Gentleman seeks. That is a basic flaw in Government philosophy.
Water is essential for life itself and is a fundamental necessity. It is a natural public utility and should remain so. The concept of privatisation is wrong, and the Prime Minister has admitted that its presentation has been inadequate. However, one cannot present a bad idea well, and privatisation is a rotten idea.
A number of the amendments address the subject of charges, which will depend on the investment that will be required of the water plcs, which will, in turn, depend on measures taken by the European Community to enforce acceptance of its drinking water standards. That issue is one which cannot be dodged. Those standards are based on clear scientific principles and ought to be accepted by the Government as being right and proper in ensuring the health of the consumer. The Secretary of State told the House that billions of pounds must be spent to provide clean, wholesome drinking water. Some estimates put the figure at £3 billion, while others put it at £6 billion. If the flotation of the water companies raises £7 billion to £10

billion, the Government's friends in the City may ask whether that is a reasonable deal for investors. I think not. The public cannot be expected to pay the whole bill, and some of that expense should surely be met from general taxation.
Here is the rub. The Bill as drafted enables water plcs to fleece consumers, regardless of their ability to pay, to meet the cost of an investment programme that should be a public duty. The RPI plus K formula and the K calculation for price increases incorporate efficiency savings and a cost pass-through factor for consumers relating to additional expenses. That factor will be deducted from inflation but there will still be an additional amount to pay, and no one can argue otherwise. The prices resulting from those calculations could double every seven years, and, by the application of the RPI plus K formula, water charges could rise by 150 per cent. by the end of the century rather than by the 12·5 per cent. that the Secretary of State anticipates.
The flaw in the formula is that efficiency is assessed only in relation to other companies, which are in any case monopolies, so any notion of comparative competition is a fallacy. One cannot have competition between monopolies that vary so much in nature—from Thames Water, with 10 million consumers and about 6,000 miles of pipeline to Welsh Water with only 3 million consumers but about 24,000 miles of pipeline.

Miss Emma Nicholson: Does the hon. Gentleman believe that companies that are not of exactly equal size and having precisely the same resources cannot be competitive?

Mr. Livsey: Companies will not be competitive in their own areas because they are ring-fenced and competition will not exist. One will not have six taps in one's house, with Perrier water coming from one of them and west country water, or whatever, coming from another.
Particular groups of people will find themselves discriminated against as a consequence of privatisation, particularly in respect of disconnections. Last year, there were 9,000 disconnections, 2,000 of them in Wales. After privatisation, private water companies will be licensed. I hope that the Minister can assure the House that the original draft licence has been altered in some respects, as it allows the plcs to draw up their own codes of practice. I know that the Minister has drawn up a code of practice on disconnection and has consulted on it, but the protection it gives is not sufficient for poorer members of the community.
Water is such an essential commodity that no one's supply should be disconnected by a private company. The only way of ensuring adequate consumer protection is by requiring the granting of a court order; the Minister has partially accepted that view. There should be a three-week cooling off period before the court acts, because of the suffering that could be created if a water supply is summarily disconnected, particularly to pensioners, families in which there are young children, and the disabled.
That problem will be exacerbated by the need of some people to pay water rates out of their supplementary benefits, particularly as water prices will rise after privatisation. It is essential that we consider the human


aspects of privatisation as it affects the poorer members of the community. I hope that the Government will take that consideration on board, as well as the other points that I have made.

Mr. Burt: I agree with the concluding remarks of the hon. Member for Brecon and Radnor (Mr. Livsey) about disconnections. As my hon. and learned Friend knows, in Committee I made a strong plea for use of the court before disconnection can be authorised. He was receptive and sympathetic, and offered to consider that proposal. I am still of the opinion that such a provision would be very helpful to the general presentation of the Bill.
I always enjoy listening to the hon. Member for Liverpool, Walton (Mr. Heffer)—as much as to my hon. Friend the Member for Macclesfield (Mr. Winterton). Although I do not always agree with the views of either of them, they represent a strand of opinion that is strongly held and sincere, and gives a contrary view to that presented by the Government. I also enjoy listening to the hon. Members for Burnley (Mr. Pike), for Manchester, Withington (Mr. Bradley) and for Wakefield (Mr. Hinchliffe), who have raised similar arguments. I do not always agree with them, but the strand of thought which produced their arguments exists in the country at present and needs to be considered by the Government. I do not treat the straw polls of the Derek Jameson show with contempt, as I recognise that they tell the Government something. They tell the Government not that they are wrong, but that their message is not reaching people yet
We start from a consensus, which was recognised in Committee by the hon. Member for Barnsley, West and Penistone (Mr. McKay) who said that Conservative Members were just as keen as Labour Members on environmental quality and the need to protect a clean, cheap, safe water supply. Everyone knows that we all share that view and want to maintain water quality. We differ as to how we wish to ensure a clean, safe water supply that is as cheap as possible. The fears that are abroad in the country have been expressed by my hon. Friend the Member for Macclesfield (Mr. Winterton). It is certainly possible to be worried by yet another privatisation. Some months ago I would have sympathised with my hon. Friend's arguments, but since I have been on the Committee considering the Bill I have been converted and I now realise that the quality improvements in the water supply that we all seek cannot be achieved without privatisation. That goes to the heart of the argument of the hon. Member for Walton, as I shall explain in a moment.
For my constituents, the bottom line is a good quality service. They are not bothered about who provides that service, but they are concerned about the service that they will eventually receive. The arguments about water are clouded by the idea that who provides the service is more important than the service itself. I and my constituents want a water supply that works and that provides clean water that is as cheap as possible. I am more worried about that than about who provides it.

Mrs. Ann Winterton: I have been listening very carefully to my hon. Friend's arguments. Does he represent any rural areas? He said that he wanted the highest quality water for all hisconstituents. Does he agree that the cost of that water should be the same for all his

constituents, whether they live in rural areas or in towns? He will probably be aware that, in addition to the increased costs of water brought about by privatisation, and by improvements in the quality of water, there may well be additional costs in rural areas to people living at the wrong end of a supply pipeline. Does he agree that in other privatisations, such as British Telecom and that of electricity, which is going through the House, the status quo is maintained and the same charge is levied on constituents living in rural and urban areas? Surely that is a fair point.

Mr. Burt: I represent more town than rural areas, and the rural parts of my constituency are not far from major towns and cities. I believe that pricing policy is a matter for the water companies, as it is for the water authorities at the moment. But I am certain that the highest-quality water will be produced at the cheapest possible cost for everyone. My hon. Friend will be able to make her own arguments about water quality later.
Some time ago, I would have been sympathetic to the arguments of the hon. Member for Copeland (Dr. Cunningham). He takes the cosy view that we can have improvements in the regulation and quality of water supply without affecting the way in which the service is supplied. In a sense, he takes a lazy view—that we can have the best of everything without changing the structure of the industry. But that is not a fair compromise and it does not work. Only privatisation, the key to freeing investment, can possibly supply the improvements in quality that we need. That is why the amendments moved by the hon. Member for Copeland are wrong.
I do not believe that the crux of the matter has been correctly perceived by Opposition Members, some Conservative Members and the public. They do not understand the connection between privatisation and the changes to regulation and quality control in the industry. Privatisation is vital because it will free the water companies and allow them to attract investment. It will free the companies from the political control previously exercised upon them. I pray in aid the views of the chairmen of the Water Authorities Association in a letter to all Members of Parliament about water privatisation:
Is it also the way to avoid the constraints on necessary capital investment which we have experienced under Governments of different political complexions over the 15 years or so since the formation of the Authorities.

Mr. Elliot Morley: Is it not the case that the chairmen of the water authorities are political appointees, and that, contrary to the views of their employees and their commercial and private customers, they have supported water privatisation, even to the extent that every water authority has a contact point with a Tory Member of Parliament? They have been having cosy little dinners and wining and dining their contacts. The letter was a completely political statement. The chairmen of the water authorities stand to do very nicely out of privatisation, unlike their customers.

Mr. Burt: During the proceedings on the Bill, we have been lobbied by a variety of different groups, each expressing its own point of view. The hon. Gentleman can take whatever view he wishes about the chairmen of the water authorities, but they are responsible for the authorities at the moment and are as entitled to express their views as other interests are entitled to lobby


Opposition Members who have quoted them strongly during the debate. I am as entitled to quote other points of view as the Opposition are.
The case for privatisation is clearly made when we consider the investment in the water industry in recent years. We have debated time and again the investments made by previous Labour Governments and by the present Government. I wish to draw attention to the trend in water investment under the last Labour Government and under this Government. When the Labour party was in office, it started much higher investment and continually ran it down. Opposition Members have consistently quoted the average level of investment, but the trend was that the level of investment continued to drop steeply and only under this Government have the tables been turned and investment has started to rise. While investment was falling, consumers were receiving some remarkable demands in increased charges. In 1975–76, when investment was falling steeply, the average rise in water rates throughout the authorities, not only the statutory water companies, was an astonishing 43 per cent. As investment was declining, charges were shooting up. At present, investment is rising.

Mr. Allan Roberts: One of the reasons why revenue costs increased, causing increased water rates, was that under this Government water authorities have been forced to fund capital expenditure from revenue because how much they could borrow for capital purposes was restricted by the Government.

Mr. Burt: The hon. Gentleman makes my point. As long as investment for the water industry is in the hands of Government, of whatever complexion, and subject to Treasury control, there will probably never be as much investment as is necessary.

Mr. Roberts: Rubbish.

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Mr. Burt: The hon. Gentleman says, "Rubbish." With the best will in the world, the Labour Government would have liked to do more for the water industry, but because of the way in which they managed the economy and had to use the International Monetary Fund, investment fell so dramatically and severely that it almost irreparably damaged the capital structure of the industry. We are only now picking up that bill. It is vital to free the industry from such constraint and to allow it the money it needs to put into effect the repairs and improvements in water quality that we all want. That is why I believe there is a fundamental link between the privatisation of the supply of the industry and improvements in quality through regulation.
It is important that the public should understand that the springboard of privatisation has challenged the myth that everything is better in the public sector. It has led to important new initiatives that will help consumers in the future.
Concern has been expressed that private monopoly companies will abuse their control, so the National Rivers Authority has been introduced. Everyone agrees that it is a good idea, but no Government put it forward before. It was encouraged only by the spur of privatisation. It is because people are concerned that there might be abuse of prices that a Director General of Water Services has been appointed. It is because people are worried about the

introduction of private companies that the consumer's charter has been introduced. All those benefits and improvements would not have been obtained without privatisation.
The improvements to regulate quality which have been demanded by all of us would not have occurred with out a change in the regime for the supply side of the industry. That is why I believe that there is a fundamental link between privatisation and regulatory controls. Privatisation will provide the funding that has been so woefully lacking from Government investment over the years. When people understand that fundamental link, they will believe that this measure will be good for the consumer, the environment and the country.

Mr. Keith Bradley: Following the speech of the hon. Member for Bury, North (Mr. Burt), in which I am sure he convinced himself of his arguments, the slogan at the next election will be, "We come to bury Burt, not to praise him."
On the second day of the Report stage, the farce has continued of Conservative Back Benchers trying to digest the propaganda being put out by No. 10 Downing street. They tried to re-present the arguments to the public for privatisation, but re-presentation of the arguments will not work.
I should say how much we support the hon. Member for Macclesfield (Mr. Winterton), who expressed the clear views of thousands, if not millions, of Tory voters. I have received letter after letter from constituents who were not previously supporters of the Labour party but who have said that the Bill marks a clear change in how they will vote in future. The hon. Member for Macclesfield represents those views.
We regard part II as the evil of the Bill. It must be stressed that, although we support the National Rivers Authority, it will not be as effective as the national environmental protection agency that the next Labour Government will set up. We must consider the pollution not only of rivers but of land and air in an integrated approach. We must not destroy the concept of integrated river basin management that we have under the current water authorities. Although under amendment No. 1 we are not ruling out the NRA, we must continue to express our concern that, without proper staffing and resources, even this part of the Bill will not be worth supporting.
Time is short, so I shall deal briefly with three issues that arise under part II of the Bill—comparative competition, pricing policy and disconnections. My hon. Friend the Member for Copeland (Dr. Cunningham) devastatingly exposed the Government's arguments for part II of the Bill. It would be folly to try to compete with his excellent speech, which destroyed the Government's credibility, but it is worth reinforcing some of the issues about which we are especially concerned.
We have clearly shown the flaws in the concept of comparative competition. There is no validity in the Government trying to compare competition in the food industry with that in the water industry. If people want to change the place where they buy their food they can move from shop or supermarket to obtain the lowest prices. No such choice will exist for water. It is a natural monopoly, and after privatisation the public will have no choice about which water plc they buy their water from.
We clearly showed in Committee that the only way in which comparative competition would have any reality for


the consumer would be if a tap from each plc were installed in every house and people could use the tap providing the cheapest water. We know that that is a farce and will not happen. In future, there will have to be not only taps from the 10 new water plcs but one running through the Channel tunnel from French water companies.
In his more manic utterings, the Secretary of State clearly told the public that there was choice not because of the water companies but because they can buy bottled water or Perrier water instead of using water from the tap. That is nonsense to the people of Manchester who struggle to choose what food or fuel they can afford. As usual, the hon. Member for Gainsborough and Horncastle (Mr. Leigh) is holding his face in pain when an hon. Member is talking about poor, low-income families in Manchester. Yesterday, yet again we saw him trying to impersonate Alan B'stard—or was it the other way round?—when he was discussing the NRA. He showed that he has no grasp of the real world. He does not represent the views of real people.
The Director General of Water Services is meant to consider comparative competition. We must consider the position in different water authorities and the problems facing water authorities such as those in the north-west, the problems of huge debt and inadequate investment. No comparative competition indicators, whether they are devised by the Director General of Water Services, the Audit Commission or whichever body the Government choose to set up, will ensure competition between companies. People will be tied to the problems, debts and investment problems of the water company in their area. [Interruption.] Does the hon. Member for Crawley (Mr. Soames) want to intervene?

Mr. Soames: Certainly not.

Mr. Bradley: Throughout the deliberations in Committee, the Government advanced no credible argument to show that prices will not have to rise massively. They will have to rise massively to meet the investment required by the industry and to meet the potential investors' wish for a quick buck. They will need to make a quick buck if they are seriously to consider investing. When they see other privatisations, such as electricity, coming along, they will make choices, and when they see that there is no money to be made out of water, they will wait for the other privatisations.
When we discussed the price rise with the Minister, he said that it would be between 7·5 per cent. and 12·5 per cent. above that already in the investment plans of the water authorities. He has not been able to say how much is already included in the forward plans of those companies. When we pressed him in Committee, he said:
The programmes, to which the Secretary of State referred when he gave that estimate, are already out of date. That cost will be met by a mixture of charging and borrowing. Therefore, we cannot make a sensible estimate of the cost of these programmes. We have given the cost of the additional programmes as explained by the Secretary of State."— [Official Report, Standing Committee D, 21 February 1989; c. 1207.]
The Government can give no estimate of the real price increases required. We have only to study the increases in the charges of the private water companies to see that the new water plcs will put prices up by as much as 30 per cent.

to 40 per cent. to meet the investment required and to ensure that investors will make a quick profit on their investment.
Disconnections are an issue of crucial importance. When we consider consumers in constituencies such as Manchester, Withington, we must consider the thousands of low-income families, low-income pensioners and low-income people with handicaps and disabilities who have to manage on meagre benefits. We have to ask the Government pertinent questions about how they will handle the hardship that may be caused by such dramatic price increases. We have to ask the Government how people on income support or housing benefit will deal with the dramatic increases in prices. Benefits such as child benefit—a crucial support to low-income families—have been frozen. Prices will not be frozen; they will rise. Low-income families need to be assured that they will be able to afford the water coming through their taps in future.
We need to ask the Government some specific questions tonight about disconnections. We need to ask, as the hon. Member for Brecon and Radnor (Mr. Livsey) pointed out, why there has already been a dramatic increase in disconnections and how those disconnections will relate to the price increases after privatisation, if it goes ahead. If families are disconnected, how long will the Government expect them to survive without an adequate water supply to their homes? If there are disconnections, how long will the Government be prepared to let the community suffer from the increased public health hazard of families being disconnected? That will place an increased demand on an already overstretched National Health Service.
We must ask the Government whether, if metering is to be the preferred option of the new private companies, the cost of metering, estimated at £1·3 billion, will be passed directly to consumers by being included in future charges. There will be an extra demand for water from families with children, families with handicapped or disabled members or families which have a large number of elderly members. Will the extra demand for water in such families, reflected through the meter, cause the Government to reconsider the pricing policy?
If families are disconnected, as we fear, will there be any penalty on neighbours and friends who care for those people supplying water to them to ensure that they do not become a health hazard and to ensure that they have healthy, clean water coming into their homes? Should not the code of practice be a statutory code which covers all water companies and does not allow each separate water company to devise its own system, which will mean different regimes for disconnection in different parts of the country?
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Cities such as Manchester have a proud heritage of investment in their water industries. As other hon. Members have pointed out, it was the ratepayers of such cities who paid for the water industry and who were in the forefront of public health legislation to ensure proper water supplies in their homes. Such cities will not have those assets passed to the water authorities without a fight and without any element of compensation for taking away assets that have previously been paid for by the ratepayers. The legal challenge will come from cities such as Manchester to ensure that the assets that belong to local people are retained by those people.
We must look at campaigns against privatisation, such as that in Manchester, which join together individuals, groups represent-ing consumer interests, groups representing pensioners' interests, groups representing conservation and environmental issues and the Ramblers Association. They are all joining together to say to the Government that they are not going to have this privatisation. Such campaigns will be successful. This Bill will be the Government's Achilles' heel, unless they decide tonight to support our amendments or the amendment tabled by the hon. Member for Macclesfield. The Government should think again, because if they do not, they will be forced into submission by 1991.

Mr. Knapman: I am extremely grateful for the chance to catch your eye, Mr. Deputy Speaker, because I sat here for most of yesterday and have done so again for most of today. I appreciate your difficulty, as so many of my hon. Friends want to demonstrate their support for this excellent Bill. For that reason, I shall be brief.
My right hon. Friend the Secretary of State said yesterday that of four Opposition amendments under discussion two were unnecessary and two were undesirable. I hesitate to suggest that perhaps it is good that my right hon. Friend is not here tonight, but I do not know what he would make of the collection of Opposition amendments before us. Amendment No. 1 seeks to delete the whole of part II—clauses 10 to 98. I hope that the Government will not be tempted to accept those deletions, because they would make some little difference to the Bill, which was considered in detail in Committee.
I should have thought that all hon. Members would welcome the creation of the National Rivers Authority. It is a giant step forward because it will be a far more effective regulatory body than any we have had before and will be guided by clear and comprehensive codes of practice. However, the Opposition amendments seek only to achieve two things—to dot the i's twice and to cross the t's twice. That would be not a step forward, but a recipe for inaction and would strangle the National Rivers Authority with red tape. The authority's success will not be measured in the tons of annual reports that the Opposition wish them to produce. The authority should be in a position to produce a quick response to problems as they arise.
Having listened to Opposition Members, I fail to understand why there is any need for them to support the National Rivers Authority. I listened with interest to the hon. Member for Burnley (Mr. Pike). In the first sitting of the Committee, he welcomed the creation of a National Rivers Authority. He was always good value in Committee and I believe that he also mentioned that he was a member of the Select Committee on the Environment, which recommended the creation of the National Rivers Authority. He spoke of that with some pride and had every reason to do so. But I do not understand what value the National Rivers Authority has for the Opposition, because they oppose privatisation.
The Government rightly say that we need to separate the gamekeeper from the poacher—in this case, the provider or water plc. Perhaps there is no particular reason why the National Freight Corporation should be a hundred times more profitable and efficient than British Road Services, but it is, and that is a fact. In the same way, the water plcs will be a great deal more efficient than the

existing water authorities. The Bill provides for the separation of the poacher from the gamekeeper or regulator, the National Rivers Authority.
Conservative Members seek a clear-cut division of responsibility—this is the crux of the matter—whereas the Opposition want to retain water authorities in public ownership. That is not a poacher-gamekeeper relation-ship; it is a two gamekeepers relation-ship, which is neither satisfactory nor practical. If the Opposition had their way, we would have two Government bodies exchanging correspondence. The two gamekeepers would soon get to know each other's ways and each other's foibles, and. with all the red tape and reports that the system would entail, it would be a recipe for inaction. The buck would stop nowhere.

Mr. Morley: I have been listening carefully to the hon. Gentleman's argument, but I find it hard to understand why the National Rivers Authority should not be as effective when dealing with water companies in the public sector. Are not public health inspectors effective in their inspections of public abattoirs? Are not Her Majesty's inspectors of pollution effective in overseeing industries in the public sector? It seems to me that they are equally effective—there have been no complaints—so I do not understand the hon. Gentleman's argument.

Mr. Knapman: I am grateful to the hon. Gentleman for raising that point. He served on the Standing Committee and will have listened to his hon. Friends the Members for Copeland (Dr. Cunningham) and for Dewsbury (Mrs. Taylor) talking at length about the importance of the Camelford incident. They were entirely right about that. It has been pointed out to them time and again that such incidents happen under the present system precisely because the poacher is not separated from the gamekeeper. That is the whole point of the Bill.
I hope that my hon. Friend the Minister will actively consider the amendment tabled by my hon. Friend the Member for Dorset, North (Mr. Baker). I realise that he has much to consider, but it seems to me that my hon. Friend's amendment is worthy of detailed examination.

Mr. Pawsey: My hon. Friend properly referred to a system involving two gamekeepers. Can he say a little more about the additional safeguards built into the Bill—for example, the director general, who is the consumers' white knight? Will my hon. Friend draw Opposition Members' attention to the effect of the other safeguards in the Bill and agree with me that, under the Bill, consumers will have more, rather than fewer, powers?

Mr. Knapman: I am obliged to my hon. Friend, who has made those points a great deal better than I could. Whereas the consumer has few rights at present, the Bill provides a code of practice that not only describes the product that must be provided—wholesome water—but allows fines to be imposed when it is not provided. I find it extraordinary that Opposition Members should argue so forcefully in favour of high standards when they know very well that there is no chance of such standards being reached under the existing system of public ownership.

Mrs. Ann Winterton: Will my hon. Friend tell the House who brought in the present system of water authorities 15 years ago? Is his memory really so short?

Mr. Knapman: The 1973 reorganisation produced integrated river basin management, and I do not see how the geographical base of that—which is the important part —is altered by the Bill, under which the 10 areas are to be retained. The Bill merely seeks to separate the poacher from the gamekeeper. The Water Act 1973 was valuable because it brought together hundreds of small water companies. It is well understood that, with the increasing demands in both the drainage and water supply sectors, it was necessary to have larger blocks of authorities. I do not seek to detract from the importance of the 1973 provisions, but I would still argue that there is justice in separating the poacher from the gamekeeper, rather than having two gamekeepers, as Opposition Members would suggest.

Mr. Dafydd Wigley: We come to the guts of the Bill. We should certainly be much happier to live with the Bill if we succeeded in removing part II. It has been suggested that the alternative to water supplied through the tap is Perrier water. Advertisements on the television showing droves of milk floats delivering hundreds of bottles of water to hundreds of doorsteps bring home to us the lack of choice. The Welsh advertising campaign brings home to us the fact that the chair of the National Rivers Authority, the former Secretary of State for Wales, is also a director of HTV and reminds us that the chairman of Welsh Water has also been made a director of HTV. One must have misgivings about the heavy use of advertising to try to sell a product which is clearly not sellable.
Wales does not want the Bill. We have seen the effects of the Government's water policies in recent years. It is interesting to note that the average domestic water bill in Wales, which was £49·08 in 1979–80, had increased to £122·61 by 1987–88; in other words, it nearly trebled. Over the same period, the required rate of return has increased from 0·3 per cent.—the going rate in 1980–81—to 2·35 per cent. in 1987–88. As the rate of return has been pushed up by the Government to increase the capital formation of Welsh Water, so the charges landing on the ratepayer have increased substantially. Similarly, we shall face enormous increases in charges for our water when the Bill is enacted because a return of 2·35 per cent. will not attract the capital necessary for the programmes that have been referred to. To achieve even a modest return of 8, 9 or 10 per cent., as Ministers have suggested, will require substantially greater charges to be levied for water.
The average equated water rate in Wales in the financial year 1988–89 is 108p in the pound as compared with 50·95p for Severn-Trent, 58·50p for North West and 33·54p in the Thames area. We already pay twice to three times the amount that those in other water authority areas pay. We dread to think what will happen to water prices in future years; it is a grim prospect for the Welsh water ratepayer.
We accept that we need to pay for the work that has to be undertaken, but we want a fairer method of payment than that proposed in the Bill. As long ago as the debate on the Queen's Speech, the Secretary of State said:
the necessary investment might increase prices by between 7·5 per cent. and 12·5 per cent. in real terms by the end of the century."—[Official Report, 28 November 1988; Vol. 142, c. 450.]
He was referring to the investment in a programme for environmental improvement, for cleaner beaches, drinking water quality and improvement of sewage treatment works and it seems that that is over and above the other inevitable increases.
The Secretary of State was very honest in his response to me yesterday. He said:
That is equivalent to an extra 7·5 per cent. to 12·5 per cent. in real terms in financial costs over the next 10 years. That is little more than 1 per cent. per year in real terms. As I have said, that is over and above the increases that would have been required without those additional programmes."—[Official Report, 21 March 1989; Vol. 149, c. 1012.]
In other words, we are facing a substantial increase. The Prime Minister said:
we shall need increases in water charges.
She claimed that it was
not for privatisation … but to provide the capital to spend on the required increased quality."—[Official Report, 16 March 1989; Vol. 149, c. 528.]
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That is what we need, but what we are saying is that the water charges will go up astronomically because of this part of the Bill. It will not just be 12·5 per cent. plus a little more, but in real terms 50, 60 or 70 per cent. The Government are acknowledging that between the lines of such answers as those given by the Secretary of State yesterday and the Prime Minister on Thursday, but that is directly contrary to the publicity campaign that was launched in Wales earlier this month. A statement released in the Committee corridor by the Minister of State, Welsh Office led to the Western Mail having the banner headline on the front page saying:
25% off—The hope for Wales's water bills.
That statement was directly engineered by the Minister of State, Welsh Office to give the impression that the legislation would lead to a 25 per cent. reduction in the price of water for Wales. That is absolutely disgraceful. I call on the Minister of State to tell the House that that statement—that leak was also given to the Daily Post on the same day—was unfounded, misleading and the people of Wales should take no notice of it. That is based, of course, on the statement that
The Government is planning to write off £460m of Welsh Water debts to make the authority more attractive to private investors and city institutions.
If that debt was written off now, water rates in Wales could be at a reasonable level instead of at the levels that we have suffered over recent years.
The Government must come clean about where they stand on the matter of the writing-off of debts. How will that be managed? Was the hon. Member for Copeland (Mr. Cunningham) right when he suggested that it would be equated between all areas? Has the matter been properly discussed? Will that be spelt out clearly in the prospectus? If we look at what was said in Committee we see that the Under-Secretary clearly had no answers to those points. He said:
A decision will be made on the amount of equity for each company that will be offered for sale. My hon. and learned Friend the Minister for Water and Planning made it clear this morning that the Government intend that 100 per cent. will be floated. How we achieve that will be decided closer to the time in the interests of the taxpayer and of maximising the flotation.
The Bill will leave the Commons without our having an inkling of the direction in which we are moving. The Under-Secretary continued:
I cannot tell the hon. Gentleman whether the equity will be 51 per cent., 71 per cent., 91 per cent., or 100 per cent. I cannot tell him whether the shares will be paid for in one go or, as with other privatisations, by part payments. I


cannot make those decisions now or say how much income will be generated."—[Official Report, Standing Committee D, 23 February 1989; c. 1326.]
In other words, we are being asked to vote for a pig in a poke. We do not know what we will be getting. All we know is that the costs will be substantially higher and those will push water charges in Wales to an astronomical level.
Privatisation is supposed to provide certain benefits. One of the benefits is said to be greater efficiency. We have not yet heard where that efficiency will come from, how many redundancies there will be, what slimming down there will be, or what services will not be provided. Privatisation is supposed to provide a great attraction for capital. That will not happen without the scale of charges that I have mentioned. Without those high charges, the capital will not be there. Privatisation is supposed to provide a better service for customers because of competition. However, many hon. Members—in fact, more Conservative Members than Opposition Members —have said that that competition is not there. It is a monopoly and one which cannot in any way be effective in the market place.
We have been told that privatisation will lead to better quality. When the main criterion will be profitability, I wonder what effect that will have on the quality of water and, indeed, on public health.
We have been told that there will be better protection for the environment, yet there is a real danger that the plc will sell its assets to raise capital that it will be unable to raise in the market place. We have been told that individuals will be more involved and that they can be shareholders. However, we know that the large institutional shareholders are likely to move in, especially with the low returns that will be available. There will be no democratic answerability and no mechanism to raise questions in the House.
We have been told that there may be a fairer charging system. Certainly, water rates can be very unfair under the present system, but will metering be fairer when someone old and incontinent will use more than the average 9,000 gallons per annum? There have been no mechanisms to allow rebates in the past. I cannot see that metering will be fairer.
We have been told that possibly there will be better co-ordination of the industry, but I wonder, when the question of the use of reservoirs and land arises and there is an opportunity to make money, whether the amenity value of the land will go out of the window.
What effect will there be on industry? The increased charges may make many industries, such as the chemical industry, uncompetitive. The Department of Industry advertised at one time the attraction of water charges as an incentive for industry. I wonder whether it could put out the same booklet as it did in 1981 and 1982. Will there be any greater stability, as we have seen companies that have been taken over having to rely on the whims of the market place? All those factors fill us with foreboding.
I tabled amendment No. 136 which refers to the need to have an absolute assurance written into this part of the Bill that there will not be any charges passed on with the introduction of meters. We welcome the Government's move on the amendments regarding disablement. Amendment No. 53, which has not been selected, deals with metering and disabled people. The Government may be able to reconsider that aspect in another place, because

in comparable Bills, such as the one for gas, a provision has already been written in. Perhaps the Minister will consider that at an appropriate time.
We are fearful of the effects of privatisation. Privatisation by a Government who do not have a mandate is not wanted by Wales. I hope that even at this late stage they will change their minds.

Miss Emma Nicholson: The speeches today have had a valedictory ring. The utterances from the Opposition resembled those of professional mourners at a funeral burying the corpse of nationalisation. I do not believe that they will ever be able to exhume that corpse and rattle its bones again. It is like a pavane for a dead doll because nationalisation has shrunk to that size. The hon. Member for Macclesfield (Mr. Winterton) has been the chief pall bearer. Speeches from other Conservative Members, however, had the ring of a job well done—a task completed and a polished performance—and were more like a march triumphant.
It is relevant that we should be discussing the Water Bill in the round, especially the retention of part H. In 1977, the United Nations declared the 1980s to be the decade of international drinking water supply and sanitation. The goal was to meet the needs of everyone world wide by 1990. The Bill ensures that in the United Kingdom we shall do just that with an innovative, imaginative and highly effective piece of legislation which will bring immeasurable benefits to the consumer.
As it enters its last year, the present decade has many notable achievements to its credit. The principal one is the establishment beyond doubt of the relationship between ill health, dirty water and poor sanitation. I remind the House that every day 30,000 people die from water-related diseases. In that context, and thinking especially of the developing world, it is interesting to note that every human being needs five gallons per diem for washing and drinking, but in the developed countries we use about 25 to 40 gallons. We are profligate with a natural resource. Water metering may help us there.
In the months in which we have been debating this major piece of legislation, we have had food scares, food and health scares and, in Committee, water scares. Unwarranted, unjustified and unscrupulous attacks have been made on the purity of unbottled British drinking water. All the medical experts of the United Kingdom have declared that water to be of excellent quality, and more of our rivers have a higher water quality than many of those in Europe.
In Committee we were threatened with Alzheimer's disease if we drank British water. The threat has been flourished with seeming relish, as though the disease would be caught by anyone drinking tap water in Britain. The chief medical officer's verdict has been wholly ignored by the Opposition. He does not believe that there is any perceived link, although he is continuing serious and proper studies.
The Opposition have based their scare stories on an invalid extrapolation from data about kidney patients undergoing dialysis and ingesting water in an abnormal way to cleanse their kidneys, with distressing but preventable side effects. As a result of that scare story, acute unhappiness has been caused to widows and widowers whose partners have died of Alzheimer's disease.
People ask me whether they were wrong to move to Devon and whether they did a terrible thing which caused their spouses to die.

Mr. Heffer: I shall not take up the last point because I am not competent to do so and I do not know whether any such problems have been caused. The hon. Lady and the Government should make up their minds. On the one hand we are told that if we privatise we shall improve the quality of water—that is the essence of the argument. The hon. Lady then says that the quality of water is better than that in most of the advanced world. I do not disagree with that. I do not agree with those who say that our water is bad. Having visited Italy regularly, particularly after the war, I remember that if one went south of Milan one was damned careful not to drink the water around Rome, and so on. We all knew what could happen. The fact is that our water is good water, so why do we need to privatise it?

Miss Nicholson: I thank the hon. Gentleman for his excellent and highly intellectual intervention based on his experience of Italian and British drinking water. The circle can be properly squared because the public are rightly becoming more environmentally conscious and calling upon us to improve the quality of our water still further. I invite the hon. Gentleman to visit my constituency, where he will discover an appalling history of poor quality water supply. The new mechanism for investment and for attracting money will improve beyond belief the appalling water that we have suffered in Bideford, Launceston and Tavistock for many years. Under the new South West Water chairman, all is being rapidly improved. That did not happen under the Labour Government appointee. With an irresponsible and heartless Opposition Front Bench team playing most meanly upon people's fears, we certainly need the Bill. It is as well that, in this context, Britannia is the clean woman of Europe.

Mr. Allan Roberts: If our drinking water is of such a high standard, why do 11 million people drink water that is below EEC standards?

Miss Nicholson: Our drinking water is only 95 per cent. perfect. We still have 5 per cent. to go.
As water scares have been promoted by the Opposition, public education is the key. We need a strong and resilient group of customer service committees with powers to call for evidence from companies outside their normal remit and with the ability to challenge those companies with their findings and to put those findings to the director general. As those customer service committees will serve the public, it is most important that their meetings should be held in public. I have never understood the idea of a body that is meant to represent the public holding its meetings in private. In that context, I commend amendments Nos. 25 and 96 to my hon. and learned Friend the Minister and to the House. They will give us that strong and outward looking public body to educate, inform and serve the customer.

Mr. Morley: The hon. Member for Torridge and Devon, West (Miss Nicholson) said that perhaps we are mourning a dog's funeral, but I believe that the Bill is more like a dog's breakfast.
The way in which the Bill has been presented is a total shambles, and the arguments have been contradictory. Amendment No. 1 seeks to discover what the Government are trying to get out of privatisation. There may be a case for a separate regulatory body, the National Rivers Authority. That is fair enough. If we delete part II we can go ahead and set up an NRA that will have the powers to regulate water quality, do something about our river quality and ensure that our sewerage standards are improved. All that could be done without everything being moved to the private sector.
The question posed by the public, which the Government must answer, is what are the advantages from putting the water and sewerage undertakers into the private sector? So far they have not come up with any convincing arguments in favour of such a move. The evidence suggests that it will be a great deal more expensive for the consumer if such a move goes ahead. They have also not told the public why a natural monopoly should be put into the hands of the private sector when its natural place should be in the public sector, where control and accountability can be exercised.
The Minister may argue that, together with passing control over to the private sector, a whole range of regulations will be introduced to prevent abuse by any private owner. That is the argument in favour of the price control mechanism. If that is the case, it makes nonsense of the argument of the Water Authorities Association that, by moving into the private sector, water companies and authorities will be free of Government interference. Given the regulations that will accompany the Bill—I accept there is a need for them—there will be more Government interference in the water companies than at present.
It is also argued that everything will be more efficient in the private sector, but that does not automatically follow. I am not suggesting that private sector companies are not efficient—many are—but if they were all efficient, there would be no bankruptcies or fraud cases. Such things happen all the time because there are good and bad companies. By making something private it does not follow that everything will be more efficient.
It is clear that the move into the private sector will be more expensive. The Secretary of State will not produce figures to show what it will mean for the public, because he dare not. If we are to achieve the necessary investment in our sewerage works, the sewage outfalls and the associated infrastructure, the necessary money must be raised. Raising such money through a privatised water company, however, will be more expensive than raising it through the public sector. Private water companies will not have access to the lower rates of interest that are available in the public sector and they may not have access to various European grants currently available. The shareholders' dividend will be an extra element that must go on top of the distribution charges.
Opposition Members have already pointed out that, if those companies are to attract private capital, there must be a decent return on it. Most companies in the private sector believe that the minimum return on capital invested is 10 per cent.
Under the present pricing regime, there is nothing like a 10 per cent. return on capital. The implication is that water charges will rise dramatically to meet that return and leave sufficient to invest in the infrastructure. Apart from some Conservative Members, nobody denies that. Even


stockbrokers in the City have given a cool response to this privatisation because they know the investment difficulties that will have to be faced.

Mr. Wigley: Is my hon. Friend aware that, in an unguarded moment towards the end of last year, the Secretary of State admitted that other factors would be involved, including what he described as the higher cost of private sector capital? The Government have shied away from putting a figure to it. Perhaps the Minister will give a figure tonight.

Mr. Morley: I am obliged to my hon. Friend for that intervention. People who think about these issues impartially recognise the logic of what I am saying. By putting the industry into the private sector, the Government are being responsible for dramatically increasing charges. Water charges for industry will also go up. That will have an effect on our ability to compete with the Europeans, especially after 1992.
Apart from the fact that it has not been proved that the industry will be more efficient in private hands, we must remember that the water authorities are part of our natural heritage. They control some areas of outstanding natural beauty, including important nature reserves and areas of leisure and recreation.
Considering the restraints that will be placed on private water companies and the fact that they will be in a financial straitjacket, having little room for growth in their core services, they will inevitably look towards the land assets that will be given to them on a plate by the Government. They will be inclined to develop those land assets, and that could have a detrimental effect not only on the conservation role of that land but in terms of access by the public and the maintenance of areas of natural beauty.
It is nonsense to suggest that the existing planning controls give sufficient protection. The Countryside Commission, a Government quango, has said that the present planning regime is not adequate to prevent the despoliation of areas of outstanding natural beauty.
Anglian Water has put up its charges this year by 12 per cent., double the rate of inflation. That is an early indicator of the way in which charges will rocket under privatisation. The private statutory companies have already said that their astronomical increases in charges are due mainly to privatisation and not to necessary investment in the infrastructure. Indeed, one has said that the infrastructure element represented only 4 per cent. of its increase and that the rest was due to privatisation.
Some of the amendments in this series deal with extending the role of agencies with sewerage functions. I hope that the Minister will reconsider some of the arguments that were adduced in Committee about the problem of private sewers that have not been adopted by local authorities because those sewers are not up to standard.
I have that problem in my constituency, in Winchester avenue in Bottesford, Scunthorpe. When that develop-ment was constructed, the sewers were not put down to an adequate standard, and the local water authority, understandably, refused to adopt them. The residents of the area are anxious because the developer of the estate blames the builder who put down the sewers and the builder claims that it is the developer's responsibility. The only people who are suffering are the residents because the

roads have not been adopted, the street lights have not been connected and the grass verges cannot be laid out, all because the sewers under the roads are in need of repair.
If we are to make changes, we should introduce into the Bill a provision by which the new water plcs have power by law to go in, to do the job, to bring the sewers up to standard and to recover the cost from the company which laid them in the first place. That would cut through the circle of complaint, with the buck constantly being passed between developers and builders. I hope that the Minister will examine that matter. Several hon. Members, including Conservative Members, raised in Committee similar problems affecting their constituencies and we should take the opportunity of this measure to tackle that problem.
The Bill will do nothing to improve the efficiency of the water companies. The restraints from which they have been suffering are artificial. If the Government want to improve our rivers and water standards and wish to make sure that various aspects of the infrastructure receive the necessary investment, they should remove those restraints and allow water authorities to borrow on the open market and have freedom to invest.
By all means establish the NRA, create more regulatory powers and introduce a more efficient code of conduct, but all of that could be done by deleting part II of the Bill and making sure that part I goes through.

Sir Anthony Grant: The 12 per cent. increase to which the hon. Member for Glanford and Scunthorpe (Mr. Morley) referred in the Anglian water authority area is in line with the forecast made by the Secretary of State for the Environment on Second Reading.
The Cambridge water authority, which supplies water to me and my constituents, recently had to announce an increase. It was not the 43 per cent. rise which some authorities have had to announce, but it was sufficiently high at 29 per cent. It made it clear that the money was required for the replacement of old plant and for other engineering necessities and had nothing to do with privatisation.
The Bill has not been adequately explained. That is undoubtedly why Mr. Derek Jameson and his telephone pollsters misunderstand the situation. I acquit the Minister of State entirely in that respect; he was bogged down in Committee, giving massive attention to detail—a task which he performed with his usual forensic skill—but it is now necessary to concentrate on the two fundamental points in the Bill. If that is done, we shall be able to disregard straw polls conducted by straw men.
The first point concerns the setting up of the NRA to deal with standards and quality. The Opposition may want the NRA to be strengthened in certain respects, but it. is agreed in all parts of the House that the basic principles of the body are right. We debated this subject at length yesterday, so at this stage I will simply say that the principles involved in establishing the NRA are right, that the fears that have been expressed about dangers to our beautiful countryside are wildly exaggerated and that we can have the highest respect for our erstwhile colleague, Lord Crickhowell, who will chair that body.
Secondly, while we are demanding higher standards, we should appreciate that our water is extremely good compared with that in some countries. Nevertheless, we and Europe want it to be better. In my constituency there is a great fuss about nitrates. We have the highest concentration of nitrates in the soil, although even that


concentration is wildly exaggerated. I pointed out in the House recently that, while nitrates are said to cause stomach cancer, the highest incidence of stomach cancer is in Wales, where there are the lowest amounts of nitrates, and the lowest incidence of stomach cancer are to be found in East Anglia, where we have the highest concentration of nitrates. That must be borne in mind before people become hysterical over this issue.
If we want higher standards, they have to be paid for. The Opposition have proposed a wrecking amendment. If we accept their arguments we shall simply stay in the same miserable circumstances as we had between 1974 and 1979, and subsequently, with the water industry standing docilely in a queue at the Treasury, trying to get the necessary investment. The water industry was not the only one to suffer between 1974 and 1979. Hospitals, nurses and everyone suffered in times of economic difficulty. The same could happen again. If the water industry is in the queue behind Ministers who are clamouring for more money for pensions, hospitals, defence and education, we will be back to square one.
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I agree with my hon. Friend the Member for Macclesfield (Mr. Winterton). Part II of the Bill provides the opportunity for competition, although not in the commercial sense as we know it. No one can say, "I do not like Anglian Water so I will go to Thames Water because it is better or cheaper." That is not what we are talking about. By their efficiency and the way in which they conduct themselves, water authorities will be able to apply to a wider circle of investors to raise funds. They will be liberated from the constraints that have caused the difficulties up to now. That is fundamental and one of the main purposes of the Bill. We must hammer that home and explain it to the people in simple terms.
Much nonsense is talked about the French taking over things. I am not so xenophobic as some hon. Members and I do not worry particularly about that. In 1992, if Anglian Water plc is efficient enough and keen enough, it may take over the French. When we were negotiating to go into the Common Market the Prime Minister, my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath), told me that Pompidou was complaining bitterly that the British had taken over the French food industry, which they had. There is no reason why the water industry should not do the same. We should not be frightened of competition and we should not talk xenophobic nonsense.
I will conclude by quoting from a letter to The Times by the chairman of Anglian Water, Mr. Bernard Henderson, who has put it as well as anyone could. He said:
For too long the United Kingdom water industry has been starved of the funds needed to carry out these improvements as it wanted to do. This has got to cease. Stop-go policies have left the water industry frustrated and underfunded time and time again.
The present Bill offers the chance to revolutionise this situation. The powers of the secretary of state and the National Rivers Authority will ensure the remedial work is carried out. The director general will oversee the maintenance of standards and impose a price control which should encourage further efficiency gains, whilst allowing for the necessary work to be financed. And the privatised companies in turn will, for the first time, have the freedom to operate outside the constraints of public expenditure policies.

Mr. Henderson has got to the root of the problem. We should forget the other nonsense and put that message forward. We should reject amendment No. 1. The sooner the Bill is on the statute book the better for everyone.

Mr. Pike: I shall be extremely brief because there is a guillotine and other hon. Members want to speak. Important issues are involved in this large group of amendments. If time permitted, I would take to task the hon. Member for Bolton, North-East (Mr. Thurnham) for some of his comments about other privatised industries; he said that they had done extremely well but he did not give a true picture of the position. Many of them have created additional top-tier jobs which have benefited those at the top, but they have not done much good for the consumer. At the end of the day we should judge things by the results for the consumer. Many times during the debate the hon. Member for Torridge and Devon, West (Miss Nicholson) has claimed to be a champion of consumer interests, but when she supported the main drift of the Bill she showed that she is no friend of the consumer.
The hon. Member for Stroud (Mr. Knapman) referred to the Select Committee report. The Minister also made an intervention about it, referring again to the chart, as he has done so many times. The Conservative Government have been in power for almost 10 years, and they must be judged on their record. The simple fact is that, in true comparative terms, the Government investment in the water industry in 1989 is lower than it was in the mid 1970s. The chart does not give the latest figures, but what I have said is correct. The Government have failed miserably.
There is some truth in the statement by the hon. Member for Stroud that the National Rivers Authority originated in the proposals of the Select Committee. While the Select Committee accepted that there was a need for a regulatory body, and a separation of the poacher and gamekeeper functions, it did not say that the industry should be privatised to achieve that objective. It stated clearly that the problems in the water industry arose not from ownership but because the Government controlled capital investment and interfered too much. There is no reason why the Government, if they wished, could not remove the PSBR from water authorities and allowed them to borrow on the open market, perhaps even involving some private sector finance. We do not need to go along the road of privatisation.
If the House does not accept amendment No. 1 to delete part II which deals with privatisation, we have grave doubts that the Bill will deliver the goods. Whatever regulatory powers are provided, at the end of the day the industry has to have profit as its prime motive. We know that the Government have to fiddle the figures anq wipe out debt. They will have to make provisions for derogations and extending the period for water authorities to meet the requirements for river and water quality, and for the improvement of beaches. If they do not, the industry will not pay.
The hon. Member for Bolton, North-East said that in other privatised industries the regulatory control for price increases was RPI minus X but that in this case it would be RPI plus K. The important difference is the plus rather then the minus.
My hon. Friend the Member for Glanford and Scunthorpe (Mr. Morley) made an important point about sewers of existing properties not being up to an acceptable standard. The Minister should recognise that it is still


possible for properties to be constructed with sewers that are not of the required standard to be taken over by water authorities. That will continue. This may not be the appropriate Bill to cover it—the Local Government and Housing Bill might be better—but the Government should do something about the problem which exists even on estates built in post-war years. The Government must accept responsibility to prevent that happening in future.
I have known the hon. Member for Macclesfield (Mr. Winterton) for many years. Indeed, I worked as a full-time Labour party organiser in the 1971 by-election that brought him to this House. He made a very bold, constructive and important speech. He recognises very clearly that, while the Government, with their majority, may win the votes in Committee and in this House, they are not winning the debate, either in Committee or in the House. But, even more important, they are not winning the debate in the nation. The people recognise that in this industry comparative competition and all that kind of nonsense is absolutely unrealistic. This will be a private monopoly. The consumers will have to pay, and if there is metering the poorer sections of the community will be penalised. If time permitted, I would go into detail on that matter.
The Government must recognise that there are important issues involved in these amendments. The latest Select Committee report on toxic waste says that the Government should make the National Rivers Authority the basis of an environmental protection agency. As I have said to the Minister before, if the Government were to drop this nonsense of privatisation and made the National Rivers Authority an environmental protection agency, they would be doing a lot more to serve the nation.

Mr. Leigh: I have now sat through five hours of Second Reading debate, 150 hours of Committee debate, and countless hours of Report stage debate.

Mr. Paul Boateng: Do you want a medal?

Mr. Leigh: The hon. Member for Brent, South (Mr. Boateng) shared those labours with me.
I am pleased that the Minister has accepted several of my amendments. The one that I have down this evening concerns due diligence, but I shall not delay the House by talking about that, as there is already considerable correspondence about it. In the two or three minutes available to me—I want to give other hon. Members a chance to take part in this debate—I shall try to boil down some of the arguments. Unless we can put over our case very simply, in a couple of minutes, we really are in serious trouble. But I think we can do so.
I hope that hon. Members opposite, who may not agree with everything I say, will at least accept that I have tried to study the Bill with reasonable care. It seems to me that we are all agreed—this is the view of the people who work in the water industry: not just the chairmen of the water authorities, but people at all levels—that there is a large measure of historical under-investment in the industry. It is accepted throughout the industry that, if it were to remain in public ownership, it simply would not get the investment it needs, given the fact that it would have to compete for scarce resources. That is not a party political point. I am not making an attack on past Labour

Governments; perhaps I am attacking the records of all Governments on this issue. There simply are no votes in sewerage. That is the first point.

Mr. Boateng: Will the hon. Gentleman give way?

Mr. Leigh: No, because I intend to speak for only two or three minutes.
The second point is that it is in the very nature of this Bill that the regulatory functions of water quality are split from the actual provision of water and sewerage. As a result, the Government and Government agencies such as the NRA are allowed to get on with the job that they do best, which is regulation, while the private sector is allowed to get on with the job that it does best, which is providing the service. That is the very essence of the Bill.
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I think that we can get the argument across in the country if we inform people that these private sector companies will not be like other private sector companies. It seems that people out in the country think that they will operate for profit in an entirely free market. In fact, they will be tightly controlled by the Director General of Water Services, operating under the K factor. They will be operating within a tightly regulated framework, and will be much more akin to private contractors working for Government Departments than to private companies. It is not so much a question of privatising something for profit margin; what we are doing is splitting up an unhealthy relationship, in which secretive water authorities have both provided the service and regulated themselves. We are creating something much more healthy—a healthy tension between Government agencies regulating, and tightly regulated private companies providing the service.
The people in the water industry to whom I have talked are actually looking forward to being let off the leash of Government control, of chopping and changing, as was mentioned in the letter from the chairman of the Anglian water authority—let off the leash of the Treasury, allowed to invest, allowed to attract private capital. That is what people in the water industry are saying. They look forward to providing a service. There may be price increases, but they will be the result of historic under-investment. The only way we can get real improvements really quickly is by privatising this industry, and to that end this amendment must be rejected.

Mr. David Hinchliffe: The hon. Member for Torridge and Devon, West (Miss Nicholson) talked about this Bill representing a march triumphant. I would argue that it is a march that tramples the poor and disadvantaged into the ground. The Bill constitutes a serious attack on the rights and interests of low-paid and disadvantaged people. The hon. Lady talked about scare stories. It is no scare story to look at the record of the present Government in water charges and the hardship that those have caused in the run-up over the past few years to privatisation. In 1984, the average bill was £76; now it is £107. It is no scare story to say that the Water Authorities Association itself said that that increase was the direct result of the Government's move towards privatisation. That is not a scare story.
Nor is it a scare story to suggest that Gordon Jones, the chairman of that association and of Yorkshire Water, has said that bills will effectively double to £200 per year by 1993. These are not scare stories. It is not a scare story to


talk about the private companies and the figures that they put forward. The Minister proudly announced that he had got the increases down to 22 per cent.—three times the rate of inflation. These are not scare stories; they are facts, truths, that the hon. Lady conveniently forgot.
Amendments 126 and 125 are intended to help the interests of the poor if this Bill goes through its parliamentary processes. They respond to the growing trend of disconnections. Over the past few years we have seen an average of 2,000 extra disconnections each year. The hon. Member for Brecon and Radnor (Mr. Livsey) referred to a figure of 9,000 disconnections this year. That so many people are deprived of such a basic commodity as water is an appalling indictment of this Government. They must be very proud of their record. We heard in Committee the Tory view of wilful non-payers—the clear distinction between the deserving poor and the undeserv-ing poor—concepts which, as my hon. Friend the Member for Liverpool, Walton (Mr. Heller) said when he was discussing measures that have been brought in in Liverpool, take us back to the last century.
I am deeply concerned about what will happen under this Bill to those families who cannot afford to meet their bills now, let alone when we have the huge increases that will be brought about by privatisation. It is vital to understand the seriousness of the situation in which families will find themselves when their water supply is cut off. I have listened to all the speeches that have been delivered since 6 o'clock this evening. Not one hon. Member opposite—not even the hon. Member for Macclesfield (Mr. Winterton)—mentioned the position of the poor, the position of the disadvantaged, the position of the disabled, the position of those people who will be, and those who have been, deprived of a water supply.
I am sure that all hon. Members have received representations and information from the citizens advice bureau nationally about the evidence it has received. It has referred to a case in Lichfield where its client, a woman who is a single parent with a three-week-old baby, had her water supply cut off without her knowledge after she had actually paid the bill. I repeat that a three-week-old baby was deprived of its water supply.
I have also referred to a family that I went to see while we were considering the Bill in Committee. The family has five children, one a nine-week-old baby, and it too was deprived of its water supply. Can any hon. Member who supports the legislation defend a nine-week-old baby being deprived of water? How on earth can people care for a child of that age without a water supply? It is a disgrace that the Bill will add to the misery of families such as the one I visited which told me—I mentioned this in Committee—that one of the children——

Miss Emma Nicholson: rose——

Mr. Hinchliffe: I am sorry but, with respect to the hon. Lady, I shall not give way to her because I am limited to only a few minutes before the wind-up speeches.
I mentioned in Committee the condition of one of the children in that family—a five-year-old child who had diarrhoea. When there was no water supply that child refused to use the toilet because it could not be flushed so the child went to the toilet in the garden. That is the sort of situation that there will be with the privatisation of

water. This country will be taken back 100 years to the conditions of the last century. I am sure that the Secretary of State, who has now just turned up, will be proud of that record.
The Bill adds to the problems that are being faced by the poor as a direct result of Government policy. The Government have hammered the poor by their discon-tinuation of water rates allowances and by the way in which direct payments of water rates have been scrapped and by the way in which the benefit system has not reflected the huge increase in water rates.
I am being looked at by my Whips so I shall sit down in a moment. I have sat here from 6 o'clock and I have had a couple of minutes in which to get this off my chest. Let us remember the poor, the disadvantaged and the deprived, not those who will make a fast buck out of the legislation.

Mr. Nicholas Baker: The hon. Member for Wakefield (Mr. Hinchliffe) spoke with feeling, as he did in Committee, and we respect him for it. I am only sorry that the hon. Member for Brent, South (Mr. Boateng) has been muzzled in this debate.
I shall be brief, but I must advise my hon. Friends—and, especially, the hon. Member for Copeland (Dr. Cunningham)—that the more I go round my part of the country and my constituency to explain the case for the Bill, the more it is understood and the more support it receives. People appreciate that the need for substantial investments is urgent. They appreciate that there is a need to define the functions of regulation and the supply of services. They appreciate also the need to raise environmental standards, even if the hon. Member for Bootle (Mr. Roberts) does not. They appreciate too that there is a need for a well-managed water industry that is capable of improving services and exporting its services, free from political control, to the Third world. They appreciate that all that is urgent.
I wish to make a point that I made in Committee on amendment No. 148, which has been tabled by my hon. Friends the Members for Daventry (Mr. Boswell), for Stroud (Mr. Knapman), for Gainsborough and Horncastle (Mr. Leigh), for Torridge and Devon, West (Miss Nicholson) and for Rugby and Kenilworth (Mr. Pawsey) and which has the support of my hon. Friend the Member for Pudsey (Sir G. Shaw), who is a former Minister and about whose knowledge of the water industry no one should feel anything but respect.
There is a need for a connection charge because of the inadequate provision made in the Bill for paying for the improvements to the infrastructure that are required to service new developments. As my hon. and learned Friend the Minister knows, the problem at the moment arises in the following way. New dwellings are connected to public water supplies and sewerage systems and they impose a demand on the existing capacity of all elements of the water and sewerage structure. The water supply elements include source works, treatment works, pumps, trunk pipelines, treated water reservoirs and distribution pipes.
The capital costs involved in new developments are high. At the moment, improvements have to be funded by cross-subsidy from existing customers and at the moment the section 52 arrangements are time-consuming and result in uncertainty for developers and water undertakers. Treatment works have to run at the limit of their capacity


to justify contributions, which results in a serious risk of failure. There is also inequity between early and late developers of buildings.
After privatisation, the problems are likely to be worse. The costs of meeting the needs of new developments will put an upward pressure on K. The contributions currently obtained from developers by section 52 planning agreements will reduce significantly after privatisation because planning authorities are bound to be less co-operative with private sector companies than they are at the moment.
The problems of cross-subsidy and pressure on K can be overcome by introducing a statutory requirement for developers to pay a connection charge. It would be a capital sum for each dwelling and would be paid before commencement of building works. The charge would be fixed at a standard rate to reflect the average cost of meeting the development needs in each water undertaking area. Application of the charge would be policed by the director general. The introduction of the charge would streamline the planning process and give developers more certainty about their commitments and enable the water undertakers to use sensible and cost-effective planning horizons to remove inequities. The whole basis for the charge is that there should be equity.
My hon. and learned Friend has said that he will look at this issue and, indeed, his officials are considering it. I hope that he can say something in his reply about his attitude to the charge. It is important for equity and would be an important element in the post-privatisation process between the water undertakers and the regulators. My hon. Friends and I look forward to my hon. and learned Friend's reply.

Mr. Howard: Last night we were treated to the extraordinary spectacle of the Labour party pressing to a vote at midnight an amendment that would not have changed the Bill's effect by one iota.
Tonight Opposition Members apparently intend to press to a Division amendment No. 1 which would delete the whole of part II and in so doing deny to the people of this country the considerable improvements in drinking water standards which we wish to see, the control over prices which the Director General of Water Services will exert and the new and unprecedented rights for customers that the Bill provides. Even by their own attitudes and standards, the Opposition's approach is incomprehensible. I shall return to that point later, but first I want to deal with some of the many other points that have been raised during this extremely interesting and wide-ranging debate.
I shall begin with the speech of my hon. Friend the Member for Macclesfield (Mr. Winterton)—as I suspect that he would expect me to. I am grateful to him for the kind remarks that he made about me, although he will understand that I approach them with a degree of caution. He made a characteristically forceful speech in which he urged the provision of a water merger control regime that would apply to all 39 water undertakers to be appointed under the Bill and would extend it in certain other respects.
The purpose of our special water merger provisions is to ensure that the director general has access to all the information that he needs so that he can compare the performance of different companies and make sure that the standards of the most efficient spread to the rest of the industry and that the customer benefits as a result. That exercise will provide a clear incentive to more efficient

management and will be a key factor in effective regulation of the industry. The ability to make these comparisons is an advantage available to the Director General of Water Services which has not been available to the regulator of any previously privatised industries. It is one of the main reasons why we can be confident that the customer will benefit from greater efficiency in the industry in future.
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However, for that to be achieved, it is not necessary that all mergers in the industry should automatically be referred to the Monopolies and Mergers Commission—as my hon. Friend would like to see. It is not necessary for this purpose to preserve all 39 water undertakers in independent ownership. To do so would be to tend to freeze the existing pattern of ownership in the industry, and there is no reason to suppose that the existing pattern is necessarily the best or most efficient. My hon. Friend also wanted, in mergers that were referred to the Commission, account to be taken of matters such as the interests of consumers and other sectors of the economy. The Commission would be able to take those matters into account under existing arrangements.
My hon. Friend referred to French investment in the industry. The really important point about French investment is that French companies are showing us what can be achieved in this industry by independent private sector companies taking advantage of the opportunities that are available. There is a huge worldwide market for water services—as my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) pointed out. The French have a large share of it. We will never be able to compete with them so long as the British water industry is a collection of nationalised industries, operating under all the constraints which are an inevitable consequence of that status. I want the British water industry to compete with the French in world markets to obtain a big share of the business that is available, and I am absolutely confident that when the industry is in the private sector that is exactly what it will achieve.
My hon. Friend the Member for Dorset, North (Mr. Baker) described the effect of amendment No. 148 which stands in his name and the names of a number of my hon. Friends. We debated it in Committee and it proved to be one of the most interesting debates of our entire proceedings. As I explained to my hon. Friend, we are still looking carefully at the evidence. We have been provided with a good deal of information which needs careful examination and I am afraid that I cannot yet announce the outcome of our study of these matters. My hon. Friend knows that I have some sympathy with the points that he makes, but I hope that he will understand that I cannot go further tonight.

Sir Giles Shaw: I fully understand my hon. and learned Friend's position. Is it still his intention to resolve this issue during the passage of the Bill, even if in another place?

Mr. Howard: If it can be so resolved, I should be very happy to resolve it in that time scale.
Government amendments Nos. 94, 95, 141 and 142 arise out of a commitment given by my hon. Friend the Parliamentary Under-Secretary in Committee to consider the possibility of deleting the references to commercial interests in clause 161, which requires the Secretary of State to lay directions made before Parliament, unless to


do so would prejudice national security. We have looked very carefully at the effect of the clause since our discussion in Committee, are satisfied that the references to commercial interests serve no useful purpose and have introduced amendments to give effect to that conclusion.
Government amendment No. 25 provides for customer service committees to have a duty to keep under review all matters affecting the interests of customers and to make representations as well as to consult the companies allocated to them about such matters. It follows an undertaking given by my hon. Friend the Parliamentary Under-Secretary to my hon. Friend the Member for Torridge and Devon, West (Miss Nicholson) in Committee, who asked for clarification of this point.
My hon. Friend the Member for Torridge and Devon, West also spoke to her amendment No. 96, the purpose of which is to provide for public access to meetings of customer service committees. We have carefully considered the matter and I am delighted to say that we have come to the conclusion that amendment No. 96, should be accepted.
Opposition amendments Nos. 122 and 123 deal with drinking water. The Bill establishes a comprehensive, new system for regulating and safeguarding the quality of drinking water. It represents the greatest legislative advance on this subject that we have ever seen.
The proposals in the Bill fully incorporate the provisions in the European Community's drinking water directive and go beyond it in a number of important instances. This will be the first time that drinking water quality standards have been laid down directly in United Kingdom law.

Mr. Allan Roberts: In the light of recent revelations that pesticides in the food chain are not easily identified, is the Minister still seeking, as he said he was in Committee, a lowering of the EC standard on pesticides in drinking water?

Mr. Howard: The hon. Gentleman knows perfectly well —he has had it explained to him many times—that all we want is a pesticide directive that is based on proper scientific standards. The present directive is not. We think that some standards should be higher and some should be lower than they are now.
Quite apart from the standards, we are specifying minimum sampling frequencies far higher than those in the European Community directive. Our regulations will specify monitoring frequencies for such substances as aluminium, iron and manganese which are at least four times higher than those in the directive. We are also specifying minimum treatment requirements which go beyond those in the Community directive.
To make sure that the companies are kept up to the mark, we are establishing a drinking water quality inspectorate with full powers to carry out thorough and technical audits of the companies' records and procedures. If a company fails to implement an inspector's recommendations, the Secretary of State will be able to make regulations requiring it to do so.
There is a new duty on companies to ensure no deterioration in the quality of their supplies, and there is a

new criminal offence of supplying water that is unfit for human consumption. It is punishable by fines or imprisonment.
In Committee, the hon. Member for Dewsbury (Mrs. Taylor) wrongly alleged that the regulations would make it more difficult to monitor samples and obtain information. The truth is exactly the opposite. Information on water quality would have to be made available to the public in a manner that makes it absolutely clear whether supplies comply with standards, and, if they do not, what is being done about that. These information requirements are far more comprehensive than those proposed or enforced anywhere else in Europe.

Dr. Cunningham: Why is it that only the Secretary of State can initiate prosecutions in connection with the matter to which the Minister has just referred? Given the many months of inactivity by the Secretary of State in connection with the Lowermoor incident, in which 22,000 people—possibly more—were poisoned by their domestic water supply, what confidence can the British people have that the Secretary of State will take whatever action is necessary?

Mr. Howard: Since, as I have said, the offence to which I have referred is a new offence which is not on the statute book, I do not understand the relevance of the hon. Gentleman's reference to Lowermoor. He is wrong even in the terms of his own question. It is not only the Secretary of State who can prosecute for this criminal offence——

Dr. Cunningham: Or the Director of Public Prosecutions, which comes to the same thing.

Mr. Howard: But that is an extremely important safeguard—the power is not confined to the Secretary of State. The DPP can also prosecute under this new criminal provision.
Against this background, what do the Opposition propose? They have tabled two amendments which would require water companies to meet quality standards determined by the European Community, but not necessarily those specified in a Community directive. In other words, the requirements that will apply to drinking water in this country could be determined administratively at any time by Community bodies such as the Commission or even the European Parliament. So the Opposition would remove responsibility for water quality entirely from the United Kingdom Government and place it with officials in Brussels. I do not know whether this is to be the model for some of the other rethinking of Opposition policy about which we hear so much these days, but I cannot believe that the hon. Member for Copeland (Dr. Cunningham) is serious about these amendments or has begun to think through their implications.
The true colour of the Opposition's approach to these matters and the extent to which they care for the customer is to be seen in amendments Nos. 128 and 131, which would strengthen the position of local authorities in carrying out sewage work as agents for the sewerage undertakers. The Opposition cling to the view, in the face of all the evidence, that local authorities are the most efficient, the most economical and the best way of achieving the best possible results in the best of all possible worlds. Policy rethinks may come and go, but the slavish


devotion of the Opposition to the local authorities which they control, and to the trade unions that control those local authorities, goes on for ever.
Amendment No. 1 would delete the whole of part II. We have waited in vain throughout this long debate for any explanation of how consumers would benefit from the amendment. Part II provides that European Community drinking water standards should be incorporated in regulations—in other words, directly incorporated into British law for the first time. What objection can Opposition Members have to that?
Part II makes it a criminal offence, for the first time, to supply water that is unfit for human consumption. Why do the Opposition want to remove that from the Bill? Part II provides for information on water quality to be published in a way that will make it absolutely clear whether water supplies comply with the standards set out in Government regulations and, if not, what the company concerned is doing about it. Why do Opposition Members wish to deny the public that information?
Part II proposes a new drinking water quality inspectorate with full and unprecedented powers to go in and carry out thorough technical audits of records, actions and procedures. Why are the Opposition opposed to that? Part II proposes a new and rigorous enforcement regime enabling the Secretary of State to specify action to be taken to remedy breaches of drinking water and other statutory requirements, a clear and open process under the scrutiny of the courts. If any Secretary of State unreasonably failed to take action where it was justified, he would himself be vulnerable to judicial review. Why do the Opposition want to remove those arrangements, which would safeguard the quality of our drinking water?
What about the powers of the director general to set prices and the customer service committees and guaranteed standards schemes and automatic refund payments? All those are contained in part II of the Bill. The Opposition's amendment would sweep away all these protections and safeguards for the consumer and we have absolutely no idea of what, if anything, they would put in their place.

Mr. Wigley: The Minister referred to the powers of the director general with regard to prices. Do the Government stick by their line that privatisation, as set out in part II, will reduce water prices in Wales by 25 per cent.?

Mr. Howard: That does not come from the Government. That report refers to the capital restructuring which will no doubt take place in the Welsh water authority, in common with other water authorities, when it is transferred to the private sector. The hon. Gentleman is well aware of that.
By aiming to remove all those protections for the customer, consumer and the citizen, the Opposition are being utterly consistent. Their record on these matters when they were in government was lamentable.
The hon. Member for Copeland used as the centrepiece of his speech the importance of having a coherent, well-planned strategic approach which, he said, we could have only in the public sector. Let us examine the extent to which the hon. Gentleman, as a member of the last Labour Government, was party to such a coherent, well-planned strategic approach to these matters. Let us consider bathing waters.
In 1975, the European Community adopted the bathing waters directive which laid down standards and required member countries to designate bathing waters which would be required to meet those standards within two years. Four years later, the Labour Government left office and not a single bathing water had been designated between 1975 and 1979. That is the coherent, well-planned strategic approach to the industry in the public sector which the hon. Member for Copeland commended.
Where was the hon. Member for Copeland at the time? He was a member of that Government and shared collective responsibility for their actions. The Labour Government had only two years to designate a bathing water, and the hon. Member for Copeland was a member of that Government, but they did not designate one during that time. What did he do about it? What did he say? Where was he?
What about the Control of Pollution Act 1974 which was placed on the statute book by the Labour Government? They inherited that from their predecessors. It looked good on the statute book, but part II dealing with river pollution was not brought into force throughout that Labour Government's term of office.
Totally inadequate and ineffectual regulation was carried out behind closed doors. There was no right of public involvement in decisions on consents to discharge into rivers and no right of private prosecution of polluters. The Labour Government had no idea of the performance of water authority sewage treatment works and they did not even bother to find out. Where was the hon. Member for Copeland? What did he do? What did he say? Where was the coherent, well-planned, strategic approach that one is supposed to find only in the public sector? We all know about the cuts in investment, about river pollution, and about enforcement being left in the hands of the water authorities.
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It is this Government who are tackling the task of cleaning up our water environment. We have embarked on the most comprehensive programme to clean up rivers in our country's history. We are introducing an open system of effective regulation where there was none. We are giving the public the right to be involved in decisions on consents to discharge where there was none. We are the Government who have introduced a system of sewage works discharge consents, and performance standards against which they can be measured, where there was none, and we have opened the whole thing up for public inspection.
We are the Government who have given the public the right to prosecute polluters, and we are introducing for the first time the new criminal offence of supplying drinking water that is unfit for human consumption.
Yesterday, the House debated the National Rivers Authority, which will be at the centrepiece of our new regulatory system. That authority and all the other provisions will count for nothing if we do not transfer the industry to the private sector. That point was made by several of my hon. Friends, including my hon. Friends the Members for Cambridgeshire, South-West (Sir A. Grant), for Bury, North (Mr. Burt) and for Gainsborough and Horncastle and, in an intevention, by my hon. Friend the Member for Wirral, South (Mr. Porter). They all put their finger on it. It is only when the industry is in the private


sector and has access to private sector resources and is benefiting from all the efficiency of the private sector that we shall see improvements.
The truth is that privatisation alone will ensure that the environmental achievements we all want to see are made as quickly as possible. The Government will set the standards, the regulators will police the standards, and the companies will deliver the standards using private sector resources. That is the way we shall get fresher rivers, cleaner bathing waters and purer drinking water. That is why the Opposition's amendments are wholly miscon-ceived, and that is why our proposals deserve the wholehearted support of the House.

Mr. Allan Roberts: The hon. and learned Gentleman is becoming a caricature of a Minister under threat. I am not surprised that, except in the closing minutes of his speech, he spent all his time on the minutiae of the Bill and did not address the major issues of principle. We are opposed in principle to the privatisation of water. That is why we have proposed an amendment to exclude part II of the Bill.
The hon. Member for Batley and Spen (Mrs. Peacock) is quoted in the Yorkshire Evening Post for 3 March 1989 as commenting:
Water is a natural commodity which cannot be commercially and competitively produced. Rainfall is not an area of entrepreneurial activity.
I notice that the hon. Lady is not in her place, but she is one Conservative Member who has got it right.
The Government are in a mess. The Bill has been badly presented. It is badly drafted and ill-conceived. The Government are finding that it is unpopular throughout the country. What do they do? 'They summon up the cavalry to charge to their assistance, ten good men and true—the chairmen of the water authorities, members of the Water Authorities Association—and an independent group if ever there was one. Surprise, surprise—10 supporters of the Conservative party, all appointed by Conservative Secretaries of State, think that privatisation is a good thing. I am not surprised. We know what will happen to the salaries of the directors of water authorities after privatisation. The top executive remuneration in British Airways before privatisation in 1979 was £45,000 at 1988 prices. In 1988 it was £253,000. In 1979 the remuneration of top executives at British Gas was £49,000 at 1988 prices. In 1988 it was £184,000. It has happened in every other privatised industry, so it will happen in the water industry. I am not surprised that the chairmen are in favour of privatisation and gallop to the assistance of a Government in a mess.

Mr. Pawsey: Will the hon. Gentleman tell the House about the increase in profitability and efficiency of the industries that he has just been knocking?

Mr. Roberts: My electorate in Bootle are not too keen on a privatised British Telecom because they are never put through to the right number and they cannot find a call box that works.
Leaving aside the chairmen of the water authorities, there is great concern among Conservative Back Benchers. The right hon. Member for Henley (Mr. Heseltine) galloped to the rescue of the Government and we have heard speeches from other Conservative Members along the same lines of the proposals advocated

by the right hon. Member for Henley in yesterday's debate. The right hon. Member for Henley was Secretary of State for the Environment in 1987–88, but he has suddenly discovered the answer to the Government's difficulties. There will be massive increases in water charges to pay for environmental improvements in future. The consumer will have to pay. The right hon. Member for Henley and other Conservative Members have decided that it would be better if those improvements were paid for out of public expenditure, but they have not said that. They have said that the Government should sell the water authorities to the private water companies and then give back the proceeds of the sale to the private companies to spend on environmental improvements.
The right hon. Member for Henley should examine his own record. At 1987–88 prices, using GDP deflators, £1,062 million was spent in water authority capital expenditure in 1979–80. In 1980–81, under the right hon. Member for Henley, the figure was £1,026 million, and in 1981–82 was £938 million. There was a massive cut in water authority capital expenditure while the right hon. Gentleman was Secretary of State for the Environment. However, he tends to have conversions on the road to Conservative party leadership elections.
I must deal with some of the myths that the Government are creating in their attempt to justify the outrageous proposal to sell off our water assets. There is the myth that only privatisation can provide the capital expenditure to carry out all the necessary work. It will cost £3 billion to implement the EEC directive on drinking water and £1·6 billion to deal with sewage discharges above consent level. It will cost £1·3 billion to implement water metering, and the Secretary of State talks about a cost of £600 million to clean up our bathing beaches—and that is just the ones that he has identified. There will be the additional costs of dividends, profits for the shareholders and the servicing of shareholders which are not paid when the industry is in the public sector. There will be flotation and advertising costs, and the directors' fees which, as I have pointed out, will be grossly inflated. Consumers will have to pay corporation tax which is not paid by the public sector industry. All those expenses will have to be paid in addition to the capital expenditure required to clean up our rivers.
What investor seeking a return on capital would buy responsibility for the capital expenditure required to clean up the Mersey and all the other rivers in this country? No one in his right mind will buy into that responsibility if there is no return and no profit to be made from the proposals. The Government say that there will be private capital and that they will release the publicly-owned water industry from the public sector borrowing requirement. Why can they not release the publicly-owned water industry from the public sector borrowing requirement? It would be borrowing the same money from the same source, and for the same purpose—to improve quality and for capital expenditure.
The Government say that the consumer must pay, not the taxpayer or the polluter. Under their proposals, environmental considerations will come second to profit. That is why we seek to delete part II of the Bill. Clause 6 sets out general requirements to achieve profitability, economy, efficiency and return on capital. Clause 7, which relates to general environmental responsibilities, is a secondary consideration and is subject to clause 6. We want to delete part II because prices will rise if it is


implemented, partly because of environmental improve-ments but also as a consequence of privatisation and the costs that I have outlined.
We want a proper National Rivers Authority to be given wide-ranging powers over the water undertakers. The attraction for water undertakers and possible investors would fall if that happened and the price that the Government hope to realise through the flotation would be low. The Government are in a flotation dilemma. If the legislation gave the National Rivers Authority power to enforce environmental standards, and if the Director General of Water Services had sufficient power to control prices adequately, no one would buy shares in the flotation. The Government know that if EEC directives on the quality of drinking water had been written into the Bill, as we proposed in Committee, everyone would be deterred from buying shares in the privatised water companies.
Lord Crickhowell, who is chairman of the National Rivers Authority advisory committee and will be chairman of the National Rivers Authority—another independent individual appointed by the Government—is on record as saying:
I think I should make it absolutely clear that I see it as one of the priority objectives of the new National Rivers Authority to operate a slim, efficient, cost conscious organisation.
That cost-conscious organisation will have inadequate resources to enforce necessary environmental standards and will sub-contract many of its responsibilities to the private water companies, establishing the gamekeeper and poacher as the same body.
The Opposition and the public are offended by the callous disregard shown by the Secretary of State and Conservative Members for those in the greatest need, introducing a regime which will cut off people's water if they have difficulty paying bills without regard to the public health of the nation. If people's electricity is cut off, it is bad for them and their families. If their water is cut off, it is not just bad for them and their families—it is a public health hazard and it is bad for the whole community. The Government fail to realise that. [Interruption.] It is obvious that the Secretary of State has not been drinking much water with his dinner.
The issue of principle for which we are arguing would keep this essential public asset in public ownership. The next Labour Government will take the water industry back into social ownership——

Sir Anthony Grant: rose——

Mr. Roberts: —that is, if the Conservatives ever succeed in floating it in the first place.
I refer finally to the Prime Minister's statement at the weekend:
Bag it and bin it and then we will win it.
She must have been taking lessons from Dan Quayle, but Mrs. Thatcher is no Dan Quayle. The only way out for the Government and their bankrupt policy for the water industry is to take the Water Bill and bag it and bin it. That is their only hope.

Question put, That the amendment be made:—

The House divided: Ayes 199, Noes 300.

Division No. 132]
[10 pm


AYES


Abbot, Ms Diane
Anderson, Donald


Adams, Allen (Paisley N)
Archer, Rt Hon Peter


Allen Graham
Armstrong, Hilary





Ashley, Rt Hon Jack
Hogg, N. (C'nauld &amp; Kilsyth)


Ashton, Joe
Holland, Stuart


Barnes, Harry (Derbyshire NE)
Home Robertson, John


Barnes, Mrs Rosie (Greenwich)
Hood, Jimmy


Battle, John
Howarth, George (Knowsley N)


Beckett, Margaret
Howell, Rt Hon D. (S'heath)


Benn, Rt Hon Tony
Howells, Dr. Kim (Pontypridd)


Bennett, A. F. (D'nt'n &amp; R'dish)
Hoyle, Doug


Bermingham, Gerald
Hughes, John (Coventry NE)


Bidwell, Sydney
Hughes, Robert (Aberdeen N)


Blair, Tony
Hughes, Roy (Newport E)


Boateng, Paul
Hughes, Sean (Knowsley S)


Boyes, Roland
Illsley, Eric


Bradley, Keith
Ingram, Adam


Bray, Dr Jeremy
Janner, Greville


Brown, Gordon (D'mline E)
Jones, Barry (Alyn &amp; Deeside)


Brown, Nicholas (Newcastle E)
Jones, Ieuan (Ynys Môn)


Brown, Ron (Edinburgh Leith)
Jones, Martyn (Clwyd S W)


Bruce, Malcolm (Gordon)
Kennedy, Charles


Buckley, George J.
Kinnock, Rt Hon Neil


Caborn, Richard
Kirkwood, Archy


Callaghan, Jim
Leadbitter, Ted


Campbell, Ron (Blyth Valley)
Leighton, Ron


Campbell-Savours, D. N.
Lestor, Joan (Eccles)


Cartwright, John
Lewis, Terry


Clark, Dr David (S Shields)
Litherland, Robert


Clarke, Tom (Monklands W)
Livingstone, Ken


Clay, Bob
Livsey, Richard


Clelland, David
Lloyd, Tony (Stretford)


Clwyd, Mrs Ann
Lofthouse, Geoffrey


Cohen, Harry
Loyden, Eddie


Coleman, Donald
McAllion, John


Cook, Frank (Stockton N)
McAvoy, Thomas


Cook, Robin (Livingston)
McCartney, Ian


Corbett, Robin
Macdonald, Calum A.


Corbyn, Jeremy
McFall, John


Cousins, Jim
McKay, Allen (Barnsley West)


Crowther, Stan
McKelvey, William


Cryer, Bob
McTaggart, Bob


Cummings, John
McWilliam, John


Cunliffe, Lawrence
Madden, Max


Cunningham, Dr John
Mahon, Mrs Alice


Darling, Alistair
Marek, Dr John


Davies, Rt Hon Denzil (Llanelli)
Marshall, David (Shettleston)


Davies, Ron (Caerphilly)
Marshall, Jim (Leicester S)


Davis, Terry (B'ham Hodge H'I)
Martin, Michael J. (Springburn)


Dewar, Donald
Maxton, John


Dobson, Frank
Meacher, Michael


Doran, Frank
Meale, Alan


Dunnachie, Jimmy
Michie, Bill (Sheffield Heeley)


Dunwoody, Hon Mrs Gwyneth
Mitchell, Austin (G't Grimsby)


Eadie, Alexander
Moonie, Dr Lewis


Eastham, Ken
Morgan, Rhodri


Evans, John (St Helens N)
Morley, Elliott


Fatchett, Derek
Mowlam, Marjorie


Field, Frank (Birkenhead)
Mullin, Chris


Fields, Terry (L'pool B G'n)
Murphy, Paul


Flynn, Paul
Nellist, Dave


Foster, Derek
Oakes, Rt Hon Gordon


Foulkes, George
O'Brien, William


Fraser, John
Orme, Rt Hon Stanley


Fyfe, Maria
Owen, Rt Hon Dr David


Galbraith, Sam
Patchett, Terry


Galloway, George
Pendry, Tom


Garrett, John (Norwich South)
Pike, Peter L.


George, Bruce
Powell, Ray (Ogmore)


Gilbert, Rt Hon Dr John
Prescott, John


Godman, Dr Norman A.
Quin, Ms Joyce


Golding, Mrs Llin
Radice, Giles


Gordon, Mildred
Randall, Stuart


Gould, Bryan
Redmond, Martin


Graham, Thomas
Rees, Rt Hon Merlyn


Griffiths, Nigel (Edinburgh S)
Reid, Dr John


Griffiths, Win (Bridgend)
Richardson, Jo


Grocott, Bruce
Roberts, Allan (Bootle)


Harman, Ms Harriet
Robertson, George


Hattersley, Rt Hon Roy
Rogers, Allan


Heffer, Eric S.
Rooker, Jeff


Henderson, Doug
Ross, Ernie (Dundee W)


Hinchliffe, David
Rowlands, Ted






Ruddock, Joan
Wallace, James


Salmond, Alex
Walley, Joan


Sedgemore, Brian
Warded, Gareth (Gower)


Sheerman, Barry
Welsh, Andrew (Angus E)


Sheldon, Rt Hon Robert
Welsh, Michael (Doncaster N)


Shore, Rt Hon Peter
Wigley, Dafydd


Skinner, Dennis
Williams, Rt Hon Alan


Smith, Andrew (Oxford E)
Williams, Alan W. (Carm'then)


Smith, C. (Isl'ton &amp; F'bury)
Wilson, Brian


Soley, Clive
Winnick, David


Spearing, Nigel
Winterton, Nicholas


Steel, Rt Hon David
Wise, Mrs Audrey


Steinberg, Gerry
Worthington, Tony


Stott, Roger
Young, David (Bolton SE)


Strang, Gavin



Taylor, Ian (Esher)
Tellers for the Ayes:


Turner, Dennis
Mr. Frank Haynes and


Vaz, Keith
Mr. Robert N. Wareing.


Wall, Pat





NOES


Adley, Robert
Cran, James


Alexander, Richard
Currie, Mrs Edwina


Alison, Rt Hon Michael
Curry, David


Allason, Rupert
Davies, Q. (Stamf'd &amp; Spald'g)


Amery, Rt Hon Julian
Davis, David (Boothferry)


Amess, David
Devlin, Tim


Amos, Alan
Dicks, Terry


Arbuthnot, James
Dorrell, Stephen


Arnold, Jacques (Gravesham)
Douglas-Hamilton, Lord James


Arnold, Tom (Hazel Grove)
Dover, Den


Ashby, David
Dunn, Bob


Aspinwall, Jack
Dykes, Hugh


Baker, Rt Hon K. (Mole Valley)
Eggar, Tim


Baker, Nicholas (Dorset N)
Emery, Sir Peter


Baldry, Tony
Evans, David (Welwyn Hatf'd)


Banks, Robert (Harrogate)
Fairbairn, Sir Nicholas


Batiste, Spencer
Fallon, Michael


Bellingham, Henry
Favell, Tony


Bendall, Vivian
Fenner, Dame Peggy


Bennett, Nicholas (Pembroke)
Field, Barry (Isle of Wight)


Benyon,W.
Fishburn, John Dudley


Bevan, David Gilroy
Forman, Nigel


Biffen, Rt Hon John
Forsyth, Michael (Stirling)


Blackburn, Dr John G.
Forth, Eric


Blaker, Rt Hon Sir Peter
Fowler, Rt Hon Norman


Bonsor, Sir Nicholas
Franks, Cecil


Boscawen, Hon Robert
Freeman, Roger


Boswell, Tim
French, Douglas


Bottomley, Peter
Fry, Peter


Bottomley, Mrs Virginia
Gale, Roger


Bowden, A (Brighton K'pto'n)
Gardiner, George


Bowden, Gerald (Dulwich)
Gill, Christopher


Bowis, John
Glyn, Dr Alan


Boyson, Rt Hon Dr Sir Rhodes
Goodhart, Sir Philip


Brazier, Julian
Goodlad, Alastair


Bright, Graham
Goodson-Wickes, Dr Charles


Brown, Michael (Brigg &amp; Cl't's)
Gorman, Mrs Teresa


Bruce, Ian (Dorset South)
Gorst, John


Buck, Sir Antony
Gow, Ian


Burt, Alistair
Grant, Sir Anthony (CambsSW)


Butcher, John
Greenway, Harry (Ealing N)


Butler, Chris
Greenway, John (Ryedale)


Butterfill, John
Gregory, Conal


Carlisle, John, (Luton N)
Griffiths, Peter (Portsmouth N)


Carlisle, Kenneth (Lincoln)
Ground, Patrick


Carrington, Matthew
Grylls, Michael


Cash, William
Gummer, Rt Hon John Selwyn


Channon, Rt Hon Paul
Hague, William


Chapman, Sydney
Hamilton, Neil (Tatton)


Chope, Christopher
Hampson, Dr Keith


Churchill, Mr
Hanley, Jeremy


Clark, Dr Michael (Rochford)
Hannam, John


Clark, Sir W. (Croydon S)
Hargreaves, A. (B'ham H'Il Gr')


Clarke, Rt Hon K. (Rushcliffe)
Hargreaves, Ken (Hyndburn)


Coombs, Anthony (Wyre F'rest)
Harris, David


Coombs, Simon (Swindon)
Haselhurst, Alan


Cope, Rt Hon John
Hawkins, Christopher


Cormack, Patrick
Hayes, Jerry


Couchman, James
Hayhoe, Rt Hon Sir Barney





Hayward, Robert
Needham, Richard


Heathcoat-Amory, David
Nelson, Anthony


Heddle, John
Neubert, Michael


Heseltine, Rt Hon Michael
Nicholls, Patrick


Hicks, Mrs Maureen (Wolv' NE)
Nicholson, David (Taunton)


Hicks, Robert (Cornwall SE)
Nicholson, Emma (Devon West)


Higgins, Rt Hon Terence L.
Norris, Steve


Hind, Kenneth
Onslow, Rt Hon Cranley


Hogg, Hon Douglas (Gr'th'm)
Oppenheim, Phillip


Holt, Richard
Paice, James


Hordern, Sir Peter
Parkinson, Rt Hon Cecil


Howard, Michael
Patnick, Irvine


Howarth, Alan (Strat'd-on-A)
Patten, Chris (Bath)


Howarth, G. (Cannock &amp; B'wd)
Patten, John (Oxford W)


Howell, Rt Hon David (G'dford)
Pattie, Rt Hon Sir Geoffrey


Howell, Ralph (North Norfolk)
Pawsey, James


Hughes, Robert G. (Harrow W)
Porter, Barry (Wirral S)


Hunt, David (Wirral W)
Porter, David (Waveney)


Hunter, Andrew
Portillo, Michael


Hurd, Rt Hon Douglas
Powell, William (Corby)


Irvine, Michael
Price, Sir David


Irving, Charles
Raffan, Keith


Jack, Michael
Raison, Rt Hon Timothy


Jackson, Robert
Rathbone, Tim


Janman, Tim
Redwood, John


Jessel, Toby
Ronton, Tim


Jones, Gwilym (Cardiff N)
Rhodes James, Robert


Jones, Robert B (Herts W)
Riddick, Graham


Jopling, Rt Hon Michael
Ridley, Rt Hon Nicholas


Kellett-Bowman, Dame Elaine
Ridsdale, Sir Julian


Key, Robert
Roberts, Wyn (Conwy)


Kilfedder, James
Roe, Mrs Marion


King, Roger (B'ham N'thfield)
Rossi, Sir Hugh


Kirkhope, Timothy
Rost, Peter


Knapman, Roger
Rumbold, Mrs Angela


Knight, Greg (Derby North)
Ryder, Richard


Knight, Dame Jill (Edgbaston)
Sackville, Hon Tom


Knox, David
Sainsbury, Hon Tim


Lamont, Rt Hon Norman
Sayeed, Jonathan


Lang, Ian
Scott, Nicholas


Latham, Michael
Shaw, David (Dover)


Lawrence, Ivan
Shaw, Sir Giles (Pudsey)


Lee, John (Pendle)
Shaw, Sir Michael (Scarb')


Leigh, Edward (Gainsbor'gh)
Shephard, Mrs G. (Norfolk SW)


Lennox-Boyd, Hon Mark
Shersby, Michael


Lester, Jim (Broxtowe)
Sims, Roger


Lightbown, David
Skeet, Sir Trevor


Lilley, Peter
Smith, Tim (Beaconsfield)


Lloyd, Peter (Fareham)
Soames, Hon Nicholas


Lord, Michael
Speller, Tony


Luce, Rt Hon Richard
Spicer, Sir Jim (Dorset W)


Lyell, Sir Nicholas
Spicer, Michael (S Worcs)


Macfarlane, Sir Neil
Squire, Robin


MacKay, Andrew (E Berkshire)
Stan brook, Ivor


Maclean, David
Stanley, Rt Hon Sir John


McNair-Wilson, Sir Michael
Steen, Anthony


McNair-Wilson, P. (New Forest)
Stern, Michael


Madel, David
Stevens, Lewis


Major, Rt Hon John
Stewart, Allan (Eastwood)


Malins, Humfrey
Stewart, Andy (Sherwood)


Mans, Keith
Stewart, Rt Hon Ian (Herts N)


Maples, John
Stradling Thomas, Sir John


Marlow, Tony
Sumberg, David


Marshall, John (Hendon S)
Tapsell, Sir Peter


Marshall, Michael (Arundel)
Taylor, Ian (Esher)


Martin, David (Portsmouth S)
Taylor, John M (Solihull)


Mates, Michael
Taylor, Teddy (S'end E)


Mills, Iain
Tebbit, Rt Hon Norman


Miscampbell, Norman
Temple-Morris, Peter


Mitchell, Andrew (Gedling)
Thompson, D. (Calder Valley)


Mitchell, Sir David
Thompson, Patrick (Norwich N)


Moate, Roger
Thorne, Neil


Monro, Sir Hector
Thurnham, Peter


Morris, M (N'hampton S)
Townend, John (Bridlington)


Morrison, Sir Charles
Townsend, Cyril D. (B'heath)


Morrison, Rt Hon P (Chester)
Tracey, Richard


Moss, Malcolm
Tredinnick, David


Moynihan, Hon Colin
Trippier, David


Mudd, David
Trotter, Neville


Neale, Gerrard
Twinn, Dr Ian






Vaughan, Sir Gerard
Widdecombe, Ann


Viggers, Peter
Wiggin, Jerry


Waddington, Rt Hon David
Wilshire, David


Wakeham, Rt Hon John
Winterton, Mrs Ann


Walden, George
Wolfson, Mark


Walker, Rt Hon P. (W'cester)
Wood, Timothy


Waller, Gary
Woodcock, Mike


Wardle, Charles (Bexhill)
Yeo, Tim


Warren, Kenneth
Young, Sir George (Acton)


Watts, John



Wells, Bowen
Tellers for the Noes:


Wheeler, John
Mr. Tristan Garel-Jones and


Whitney, Ray
Mr. Tony Durant.

Question accordingly negatived.

Orders of the Day — Clause 10

APPOINTMENT OF UNDERTAKERS

Amendment proposed: No. 102, in page 9, line 36, after 'Chapter', insert
'and provided that no reference to the Monopolies Commission made in accordance with section 28(2)(b) in respect of that company is outstanding.'.—[Mr. Nicholas Winterton.]

Question put, That the amendment be made:—

The House divided: Ayes 198, Noes 296.

Division No. 133]
[10.16 pm


AYES


Abbott, Ms Diane
Darling, Alistair


Adams, Allen (Paisley N)
Davies, Rt Hon Denzil (Llanelli)


Allen, Graham
Davies, Ron (Caerphilly)


Anderson, Donald
Davis, Terry (B'ham Hodge H'I)


Archer, Rt Hon Peter
Dewar, Donald


Armstrong, Hilary
Dobson, Frank


Ashley, Rt Hon Jack
Doran, Frank


Ashton, Joe
Dunnachie, Jimmy


Barnes, Harry (Derbyshire NE)
Dunwoody, Hon Mrs Gwyneth


Barnes, Mrs Rosie (Greenwich)
Eadie, Alexander


Battle, John
Eastham, Ken


Beckett, Margaret
Evans, John (St Helens N)


Benn, Rt Hon Tony
Fatchett, Derek


Bennett, A. F. (D'nt'n &amp; R'dish)
Field, Frank (Birkenhead)


Bermingham, Gerald
Fields, Terry (L'pool B G'n)


Bidwell, Sydney
Flynn, Paul


Blair, Tony
Foster, Derek


Boateng, Paul
Foulkes, George


Boyes, Roland
Fraser, John


Bradley, Keith
Fyfe, Maria


Bray, Dr Jeremy
Galbraith, Sam


Brown, Gordon (D'mline E)
Galloway, George


Brown, Nicholas (Newcastle E)
Garrett, John (Norwich South)


Brown, Ron (Edinburgh Leith)
George, Bruce


Bruce, Malcolm (Gordon)
Gilbert, Rt Hon Dr John


Buckley, George J.
Godman, Dr Norman A.


Caborn, Richard
Golding, Mrs Llin


Callaghan, Jim
Gordon, Mildred


Campbell, Ron (Blyth Valley)
Gould, Bryan


Campbell-Savours, D. N.
Graham, Thomas


Cartwright, John
Griffiths, Nigel (Edinburgh S)


Clark, Dr David (S Shields)
Griffiths, Win (Bridgend)


Clarke, Tom (Monklands W)
Grocott, Bruce


Clay, Bob
Harman, Ms Harriet


Clelland, David
Hattersley, Rt Hon Roy


Clwyd, Mrs Ann
Heffer, Eric S.


Cohen, Harry
Henderson, Doug


Coleman, Donald
Hinchliffe, David


Cook, Frank (Stockton N)
Hogg, N. (C'nauld &amp; Kilsyth)


Cook, Robin (Livingston)
Holland, Stuart


Corbett, Robin
Home Robertson, John


Corbyn, Jeremy
Hood, Jimmy


Cousins, Jim
Howarth, George (Knowsley N)


Crowther, Stan
Howell, Rt Hon D. (S'heath)


Cryer, Bob
Howells, Dr. Kim (Pontypridd)


Cummings, John
Hoyle, Doug


Cunliffe, Lawrence
Hughes, John (Coventry NE)


Cunningham, Dr John
Hughes, Robert (Aberdeen N)





Hughes, Roy (Newport E)
Pike, Peter L.


Hughes, Sean (Knowsley S)
Powell, Ray (Ogmore)


Illsley, Eric
Prescott, John


Ingram, Adam
Quin, Ms Joyce


Janner, Greville
Radice, Giles


Jones, Barry (Alyn S Deeside)
Randall, Stuart


Jones, Ieuan (Ynys Môn)
Redmond, Martin


Jones, Martyn (Clwyd S W)
Rees, Rt Hon Merlyn


Kennedy, Charles
Reid, Dr John


Kirkwood, Archy
Richardson, Jo


Leadbitter, Ted
Roberts, Allan (Bootle)


Leighton, Ron
Robertson, George


Lestor, Joan (Eccles)
Rogers, Allan


Lewis, Terry
Rooker, Jeff


Litherland, Robert
Ross, Ernie (Dundee W)


Livingstone, Ken
Rowlands, Ted


Livsey, Richard
Ruddock, Joan


Lloyd, Tony (Stretford)
Salmond, Alex


Lofthouse, Geoffrey
Sedgemore, Brian


Loyden, Eddie
Sheerman, Barry


McAllion, John
Sheldon, Rt Hon Robert


McAvoy, Thomas
Shore, Rt Hon Peter


McCartney, Ian
Skinner, Dennis


Macdonald, Calum A.
Smith, Andrew (Oxford E)


McFall, John
Smith, C. (Isl'ton &amp; F'bury)


McKay, Allen (Barnsley West)
Soley, Clive


McKelvey, William
Spearing, Nigel


McTaggart, Bob
Steel, Rt Hon David


McWilliam, John
Steinberg, Gerry


Madden, Max
Stott, Roger


Mahon, Mrs Alice
Strang, Gavin


Marek, Dr John
Taylor, Mrs Ann (Dewsbury)


Marshall, David (Shettleston)
Turner, Dennis


Marshall, Jim (Leicester S)
Vaz, Keith


Martin, Michael J. (Springburn)
Wall, Pat


Maxton, John
Wallace, James


Meacher, Michael
Walley, Joan


Meale, Alan
Wardell, Gareth (Gower)


Michie, Bill (Sheffield Heeley)
Welsh, Andrew (Angus E)


Mitchell, Austin (G't Grimsby)
Welsh, Michael (Doncaster N)


Moonie, Dr Lewis
Wigley, Dafydd


Morgan, Rhodri
Williams, Alan W. (Carm'then)


Morley, Elliott
Wilson, Brian


Mowlam, Marjorie
Winnick, David


Mullin, Chris
Winterton, Mrs Ann


Murphy, Paul
Winterton, Nicholas


Nellist, Dave
Wise, Mrs Audrey


Oakes, Rt Hon Gordon
Worthington, Tony


O'Brien, William
Young, David (Bolton SE)


Orme, Rt Hon Stanley



Owen, Rt Hon Dr David
Tellers for the Ayes:


Patchett, Terry
Mr. Frank Haynes and


Pendry, Tom
Mr. Robert N. Wareing.




NOES


Adley, Robert
Bonsor, Sir Nicholas


Alexander, Richard
Boscawen, Hon Robert


Alison, Rt Hon Michael
Boswell, Tim


Allason, Rupert
Bottomley, Peter


Amery, Rt Hon Julian
Bottomley, Mrs Virginia


Amess, David
Bowden, A (Brighton K'pto'n)


Amos, Alan
Bowden, Gerald (Dulwich)


Arbuthnot, James
Bowis, John


Arnold, Jacques (Gravesham)
Boyson, Rt Hon Dr Sir Rhodes


Arnold, Tom (Hazel Grove)
Brazier, Julian


Ashby, David
Bright, Graham


Aspinwall, Jack
Brown, Michael (Brigg &amp; Cl't's)


Baker, Rt Hon K. (Mole Valley)
Bruce, Ian (Dorset South)


Baker, Nicholas (Dorset N)
Buck, Sir Antony


Baldry, Tony
Burt, Alistair


Banks, Robert (Harrogate)
Butcher, John


Batiste, Spencer
Butler, Chris


Bellingham, Henry
Butterfill, John


Bendall, Vivian
Carlisle, John, (Luton N)


Bennett, Nicholas (Pembroke)
Carlisle, Kenneth (Lincoln)


Benyon, W.
Carrington, Matthew


Bevan, David Gilroy
Cash, William


Biffen, Rt Hon John
Channon, Rt Hon Paul


Blackburn, Dr John G.
Chapman, Sydney


Blaker, Rt Hon Sir Peter
Chope, Christopher






Churchill, Mr
Hannam, John


Clark, Dr Michael (Rochford)
Hargreaves, A. (B'ham H'Il Gr')


Clark, Sir W. (Croydon S)
Hargreaves, Ken (Hyndburn)


Clarke, Rt Hon K. (Rushcliffe)
Harris, David


Colvin, Michael
Haselhurst, Alan


Coombs, Anthony (Wyre F'rest)
Hawkins, Christopher


Coombs, Simon (Swindon)
Hayes, Jerry


Cope, Rt Hon John
Hayhoe, Rt Hon Sir Barney


Cormack, Patrick
Hayward, Robert


Couchman, James
Heathcoat-Amory, David


Cran, James
Heddle, John


Currie, Mrs Edwina
Heseltine, Rt Hon Michael


Curry, David
Hicks, Mrs Maureen (Wolv' NE)


Davies, Q. (Stamf'd &amp; Spald'g)
Hicks, Robert (Cornwall SE)


Davis, David (Boothferry)
Higgins, Rt Hon Terence L.


Devlin, Tim
Hind, Kenneth


Dicks, Terry
Hogg, Hon Douglas (Gr'th'm)


Dorrell, Stephen
Holt, Richard


Douglas-Hamilton, Lord James
Hordern, Sir Peter


Dover, Den
Howard, Michael


Dunn, Bob
Howarth, G. (Cannock &amp; B'wd)


Durant, Tony
Howell, Rt Hon David (G'dford)


Dykes, Hugh
Howell, Ralph (North Norfolk)


Eggar, Tim
Hughes, Robert G. (Harrow W)


Emery, Sir Peter
Hunt, David (Wirral W)


Evans, David (Welwyn Hatf'd)
Hunter, Andrew


Fairbairn, Sir Nicholas
Hurd, Rt Hon Douglas


Fallon, Michael
Irvine, Michael


Favell, Tony
Irving, Charles


Fenner, Dame Peggy
Jack, Michael


Field, Barry (Isle of Wight)
Jackson, Robert


Fishburn, John Dudley
Janman, Tim


Forman, Nigel
Jessel, Toby


Forsyth, Michael (Stirling)
Jones, Gwilym (Cardiff N)


Forth, Eric
Jones, Robert B (Herts W)


Fowler, Rt Hon Norman
Jopling, Rt Hon Michael


Franks, Cecil
Kellett-Bowman, Dame Elaine


Freeman, Roger
Key, Robert


French, Douglas
Kilfedder, James


Fry, Peter
King, Roger (B'ham N'thfield)


Gale, Roger
Kirkhope, Timothy


Gardiner, George
Knapman, Roger


Garel-Jones, Tristan
Knight, Greg (Derby North)


Gill, Christopher
Knight, Dame Jill (Edgbaston)


Glyn, Dr Alan
Knox, David


Goodhart, Sir Philip
Lamont, Rt Hon Norman


Goodlad, Alastair
Lang, Ian


Goodson-Wickes, Dr Charles
Latham, Michael


Gorman, Mrs Teresa
Lawrence, Ivan


Gorst, John
Lee, John (Pendle)


Gow, Ian
Leigh, Edward (Gainsbor'gh)


Grant, Sir Anthony (CambsSW)
Lennox-Boyd, Hon Mark


Greenway, Harry (Ealing N)
Lester, Jim (Broxtowe)


Greenway, John (Ryedale)
Lloyd, Peter (Fareham)


Gregory, Conal
Lord, Michael


Griffiths, Peter (Portsmouth N)
Luce, Rt Hon Richard


Ground, Patrick
Lyell, Sir Nicholas


Grylls, Michael
Macfarlane, Sir Neil


Gummer, Rt Hon John Selwyn
MacKay, Andrew (E Berkshire)


Hague, William
Maclean, David


Hamilton, Neil (Tatton)
McNair-Wilson, Sir Michael


Hampson, Dr Keith
McNair-Wilson, P. (New Forest)


Hanley, Jeremy
Madel, David





Major, Rt Hon John
Shaw, Sir Giles (Pudsey)


Malins, Humfrey
Shaw, Sir Michael (Scarb')


Mans, Keith
Shephard, Mrs G. (Norfolk SW)


Maples, John
Shersby, Michael


Marlow, Tony
Sims, Roger


Marshall, John (Hendon S)
Skeet, Sir Trevor


Marshall, Michael (Arundel)
Smith, Tim (Beaconsfield)


Martin, David (Portsmouth S)
Soames, Hon Nicholas


Mates, Michael
Speller, Tony


Mills, Iain
Spicer, Sir Jim (Dorset W)


Miscampbell, Norman
Spicer, Michael (S Worcs)


Mitchell, Andrew (Gedling)
Squire, Robin


Mitchell, Sir David
Stanbrook, Ivor


Moate, Roger
Stanley, Rt Hon Sir John


Monro, Sir Hector
Steen, Anthony


Morris, M (N'hampton S)
Stern, Michael


Morrison, Sir Charles
Stevens, Lewis


Morrison, Rt Hon P (Chester)
Stewart, Allan (Eastwood)


Moss, Malcolm
Stewart, Andy (Sherwood)


Moynihan, Hon Colin
Stewart, Rt Hon Ian (Herts N)


Mudd, David
Stradling Thomas, Sir John


Neale, Gerrard
Sumberg, David


Needham, Richard
Tapsell, Sir Peter


Nelson, Anthony
Taylor, Ian (Esher)


Neubert, Michael
Taylor, John M (Solihull)


Nicholls, Patrick
Tebbit, Rt Hon Norman


Nicholson, David (Taunton)
Temple-Morris, Peter


Nicholson, Emma (Devon West)
Thompson, D. (Calder Valley)


Norris, Steve
Thompson, Patrick (Norwich N)


Onslow, Rt Hon Cranley
Thorne, Neil


Oppenheim, Phillip
Thurnham, Peter


Paice, James
Townend, John (Bridlington)


Parkinson, Rt Hon Cecil
Townsend, Cyril D. (B'heath)


Patnick, Irvine
Tracey, Richard


Patten, Chris (Bath)
Tredinnick, David


Patten, John (Oxford W)
Trippier, David


Pattie, Rt Hon Sir Geoffrey
Trotter, Neville


Porter, Barry (Wirral S)
Twinn, Dr Ian


Porter, David (Waveney)
Vaughan, Sir Gerard


Portillo, Michael
Viggers, Peter


Powell, William (Corby)
Waddington, Rt Hon David


Price, Sir David
Wakeham, Rt Hon John


Raffan, Keith
Walden, George


Raison, Rt Hon Timothy
Waller, Gary


Rathbone, Tim
Wardle, Charles (Bexhill)


Redwood, John
Warren, Kenneth


Renton, Tim
Watts, John


Rhodes James, Robert
Wells, Bowen


Riddick, Graham
Wheeler, John


Ridley, Rt Hon Nicholas
Whitney, Ray


Ridsdale, Sir Julian
Widdecombe, Ann


Roberts, Wyn (Conwy)
Wiggin, Jerry


Roe, Mrs Marion
Wilshire, David


Rossi, Sir Hugh
Wolfson, Mark


Rost, Peter
Wood, Timothy


Rumbold, Mrs Angela
Woodcock, Mike


Ryder, Richard
Yeo, Tim


Sackville, Hon Tom
Young, Sir George (Acton)


Sainsbury, Hon Tim



Sayeed, Jonathan
Tellers for the Noes:


Scott, Nicholas
Mr. David Lightbown and


Shaw, David (Dover)
Mr. Alan Howarth.

Question accordingly negatived.

It being after half-past Ten o'clock, MADAM DEPUTY SPEAKER proceeded, pursuant to the Order [6 February] and the resolution yesterday, to put forthwith the Questions on amendments moved by a member of the Government up to the end of clause 98.

Orders of the Day — Clause 19

ORDERS FOR SECURING COMPLIANCE WITH CERTAIN PROVISIONS

Amendment made: No. 141, in page 21, line 38, leave out 'or the commercial interests of any person'.—[Mr. Howard.]

Orders of the Day — Clause 20

PROCEDURAL REQUIREMENTS

Amendment made: No. 142, in page 24, line 26, leave out 'or the commercial interests of any person'.—[Mr. Howard.]

Orders of the Day — Clause 26

PROTECTION OF CUSTOMER INTERESTS

Amendment made: No. 29, in page 29, line 2, leave out paragraph (a) and insert—
'(a) to keep under review all matters appearing to the committee to affect the interests of the persons who are customers or potential customers of the companies allocated to the committee, to consult each company so allocated about such of those matters as appear to affect the interests of the customers or potential customers of that company and to make to a company so allocated all such representations about any such matter as the committee considers appropriate; '.—[Mr. Howard.]

Orders of the Day — Clause 33

PUBLICATION OF INFORMATION AND ADVICE

Amendments made: No. 31, in page 37, line 32, at beginning insert—
'( ) The Secretary of State may arrange for the publication, in such form and in such manner as he considers appropriate, of such information relating to any matter which is connected with the carrying out by a company holding an appointment under this Chapter of the functions of a water undertaker or sewerage undertaker as it may appear to him to be in the public interest to publish.'.

No. 32, in page 37, line 38, at beginning insert 'the Secretary of State or'.

No. 33, in page 37, line 41, at end insert
'Secretary of State or (as the case may be) of the'.
No. 34, in page 37, line 46, at end insert
'Secretary of State or (as the case may be) of the'.[Mr. Howard.]

Orders of the Day — Clause 40

FINANCIAL CONDITIONS FOR WATER MAIN ACQUISITION

Amendments made: No. 15, in page 43,1ine 24, leave out from 'by' to end of line 27 and insert
'the annual borrowing costs of a loan of the amount required for the provision of that main.
(3A) The annual borrowing costs of a loan of the amount required for the provision of a water main is the aggregate amount which would fall to be paid in any year by way of payments of interest and repayments of capital if an amount equal to so much of the costs reasonably incurred in providing

that main as were not incurred in the provision of additional capacity had been borrowed, by the water undertaker providing the main, on terms—

(a) requiring interest to be paid and capital to be repaid in twelve equal annual instalments; and
(b) providing for the amount of the interest to be calculated at such rate, and in accordance with such other provision, as may have been determined either by the undertaker with the approval of the Director or, in default of such a determination, by the Director.'.

No. 16, in page 44, line 11, leave out subsection (7) and insert—
'(6A) Where for the purposes of subsection (1)(b) above any sums have been deposited with a water undertaker by way of security for the discharge of any obligation, the undertaker shall pay interest at such rate as may be determined either—

(a) by the undertaker with the approval of the Director; or
(b) in default of a determination under paragraph (a) above, by the Director,

on every sum of 50p so deposited for every three months during which it remains in the hands of the undertaker.
(7) An approval or determination given or made by the Director for the purposes of subsection (3A) or (6A) above—

(a) may be given or made in relation to the provision of a particular water main, in relation to the provision of mains of a particular description or in relation to the provision of water mains generally; and
(b) may be revoked at any time except, in the case of an approval or direction for the purposes of subsection (3A) above, in relation to a water main that has already been provided.'.

No. 17, in page 44, line 24, leave out subsection (9). —[Mr. Howard.]

Orders of the Day — Clause 42

CONDITIONS OF CONNECTION TO WATER MAIN

Amendment made: No. 18, in page 47, line 6, leave out subsection (3) and insert—
'(3) Where for the purposes of subsection (1)(a) above any sums have been deposited with a water undertaker by way of security for the discharge of any obligation, the undertaker shall pay interest at such rate as may be determined either—

(a) by the undertaker with the approval of the Director; or
(b) in default of a determination under paragraph (a) above, by the Director;

on every sum of 50p so deposited for every three months during which it remains in the hands of the undertaker; and an approval or determination by the Director for the purposes of this subsection may be given or made in relation to a particular case or description of cases or generally and may be revoked at any time.'.—[Mr. Howard.]

Orders of the Day — Clause 70

FINANCIAL CONDITIONS OF SEWER REQUISITION

Amendment made: No. 19, in page 80, line 37, leave out from 'by' to end of line 40 and insert
'the annual borrowing costs of a loan of the amount required for the provision of that sewer.
(3A) The annual borrowing costs of a loan of the amount required for the provision of a public sewer is the aggregate amount which would fall to be paid in any year by way of payments of interest and repayments of capital if an amount equal to so much of the costs reasonably incurred in providing that sewer as were not incurred in the provision of additional capacity had been borrowed, by the sewerage undertaker providing the sewer, on terms—

(a) requiring interest to be paid and capital to be repaid in twelve equal annual instalments; and
(b) providing for the amount of the interest to be calculated at such rate, and in accordance with such other provision, as may have been determined either


by the undertaker with the approval of the Director or, in default of such a determination, by the Director.'.

No. 20, in page 81, line 33, clause 70, leave out subsection (7) and insert—
'(6A) Where for the purposes of subsection (1)(b) above any sums have been deposited with a sewerage undertaker by way of security for the discharge of any obligation, the undertaker shall pay interest at such rate as may be determined either—

(a) by the undertaker with the approval of the Director; or
(b) in default of a determination under paragraph (a) above, by the Director,

on every sum of 50p so deposited for every three months during which it remains in the hands of the undertaker.
(7) An approval or determination given or made by the Director for the purposes of subsection (3A) or (6A) above—

(a) may be given or made in relation to the provision of a particular public sewer, in relation to the provision of sewers of a particular description or in relation to the provision of sewers generally; and
(b) may be revoked at any time except, in the case of an approval or direction for the purposes of subsection (3A) above, in relation to a public sewer that has already been provided.'.

No. 21, in page 81, line 46, leave out subsection (9). —[Mr. Howard.]

Orders of the Day — Clause 71

PERFORMANCE OF SEWERAGE FUNCTIONS BY LOCAL AUTHORITIES ETC.

Amendment made: No. 63, in page 82, line 3, leave out from 'out' to end of line 6 and insert
`sewerage functions on that undertaker's behalf in relation to such area comprising the whole or any part of that authority's relevant area, together (where that authority are a local authority or an urban development corporation and the arrangements so provide) with parts of any adjacent relevant areas of other relevant authorities, as may be specified in the arrangements.'—[Mr. Howard.]

Orders of the Day — Clause 86

RESPONSIBILITY FOR LISTING PARTICULARS OF NOMINATED HOLDING COMPANIES

Amendment made: No. 43, in page 94, leave out lines 17 to 34 and insert—
'.—(1)Where—

(a) the same document contains listing particulars for securities of two or more nominated holding companies; and
(b) any person's responsibility for any information included in the document is stated in the document to be confined to its inclusion as part of the listing particulars for securities of any one of those companies,

that person shall not be treated as responsible for that information in so far as it is stated in the document to form part of the listing particulars for securities of any other of those companies.
(2) Sections 150 and 154 of the 1986 Act (advertisements etc. in connection with listing applications) shall have effect in relation to any information issued for purposes connected with any securities of a nominated holding company as if any reference to a person's incurring civil liability included a reference to any other person being entitled, as against that person, to be granted a civil remedy or to rescind or repudiate any contract.'.

No. 44, in page 94, line 36, leave out 'and'.

No. 45, in page 94, leave out lines 39 to 42 and insert

'responsible" means responsible for the purposes of Part IV of the 1986 Act and "responsibility" shall be construed accordingly.'.[Mr. Howard.]

Orders of the Day — Clause 91

TAX PROVISIONS

Amendments made: No. 46, in page 98, line 10, after `(1)', insert
`The Secretary of State may, for the purposes of section 2 of the Capital Allowances Act 1968 (writing-down allowance), by order make provision specifying—

(a) the amount to be taken for the purposes of subsection (3) of that section as the residue on the transfer date of any expenditure in relation to which any property vested in a successor company in accordance with a scheme under Schedule 2 to this Act is a relevant interest for the purposes of that section; and
(b) the part of the period mentioned in subsection (3) of that section which is to be treated, in relation to any such property, as unexpired on that date.

(1A)'.

No. 47, in page 98, line 17, leave out from 'of' to 'had' in line 18 and insert
`such amount as may be specified for the purposes of this subsection in an order made by the Secretary of State'.

No. 48, in page 98, line 20, at end insert—
`(1B) The Secretary of State shall not make an order under subsection (1) or (1A) above in relation to any property of a successor company except with the consent of the Treasury and at a time when the company is wholly owned by the Crown; and the power to make such an order shall be exercisable by statutory instrument and shall include power to make different provision for different cases, including different provision in relation to different property or descriptions of property.'.—[Mr. Howarth.]

Orders of the Day — Clause 104

AUTHORITY FOR DISCHARGES AND OTHER DEFENCES FOR THE PURPOSES OF SECTION 103

Mr. Boswell: I beg to move amendment No. 98, in page 111, leave out line 47.
After the excitement of a few moments ago, I feel myself rather in the position of the dustcart after the Lord Mayor's show, though it would be indelicate if I were to speculate on which particular speeches require sweeping up. However, it is perhaps appropriate to start with that analogy because we now come to the parts of the Bill that are directed towards the control of pollution. This is an area in which hon. Members on both sides of the House have taken a keen interest. We are all anxious to ensure that standards are maintained and, wherever possible, raised.
The amendment would change slightly the existing provisions of the Control of Pollution Act, which, as the House will know, are reflected in the Bill. It is right and proper for me to acknowledge, though I do so with some regret, that there must be provision—as there is—for valid defences for causing pollution, provided that permission is very tightly controlled. Clearly, that applies to discharges in accordance with a consent issued by the National Rivers Authority or, in the case of this specific provision, to derogations from the penalties where there is an emergency, in order to avoid other dangers to the public. Perhaps I should say, en passant, that I am very pleased with Government amendment No. 64, which will further confine what might be called the emergency excuse.
It is right to provide for eventualities and to provide that these discharges follow the requirements of the National Rivers Authority. It is also right that there should be clarity for operators who discharge within consents and that they may do so without fear of prosecution. But, equally, I think that it will be agreed by all that there should be no easy loopholes—certainly no avoidable loopholes—in the legislation. There should be no way in which those who might pollute our rivers may do so with impunity.
Hon. Members—certainly those who served on the Standing Committee—will recall some of the debate on this clause. I am grateful for the opportunity to return to that debate, not least because the Government undertook to reflect on the very serious points that were made then. It should be remembered that the basis of clause 104 is no more than a continuation of the current law.
The defence is already available under the Control of Pollution Act 1974. Nevertheless, real problems have been drawn to my attention by the water authorities and I believe that it is right to ventilate them further. The amendment refers to waste disposal sites. Elsewhere in the clause there are references to mines and ships, but I shall confine my remarks to the issue of disposal licences. It should be made clear that where an operator wishes to obtain a site for a tip for disposal, his licence comes from the local authority, not from the water authority. I welcome the provision for the local authority to consult the water authority on such an application, which will carry forward into the new arrangements after privatisation.
Once the operator has obtained the disposal licence from the local authority, he can set up his waste disposal site. The House will be well aware of the problems that some sites cause. We are all aware of the recent report by the Select Committee on the Environment and of the articles in The Times this month. It is the experience of the water authorities that have contacted me that there are frequent examples of watercourses being directly polluted as a result of the seepage of toxic materials in leaching from such sites.
The Anglian water authority has drawn my attention specifically to three such recent incidents in its area—one at Rushton, which is in the county but not the constituency that I represent. Others are cropping up all the time. Such pollution incidents damage fisheries and damage or threaten the public water supply because this pollution is, as it were, unplanned for, is sometimes not easy to detect quickly and can be insidious. It is right to draw the House's attention to the fact that under clause 53 the water undertakers themselves will, for the first time, be guilty of a criminal offence if they supply unfit water for human consumption. Therefore, they, too, will have a close interest in avoiding the sort of pollution to which I am referring.
The House will certainly be aware that the problems with the sites arise mainly from the lack of proper provision and the lack of effective supervision of after-care arrangements by the disposal operators, especially where the site has been closed. It would be wrong in principle if such operators were also to have a special cast-iron defence because of their possession of a disposal licence, which is what the amendment seeks to strike out. As I have said, there are similar concerns over vessels and abandoned mines. These are real issues that worry hon. Members of all parties.
The water authorities have enough to do in trying to protect our rivers without this extra burden on them. Only last week I was given to understand that the Anglian water authority, which covers the greater part of my constituency, was faced with a major pollution incident in Suffolk. Pig slurry had gone into the river, affecting 30 miles, and killing thousands of fish. Tragically it was in a river that the authority had only recently restocked. No doubt there will be proceedings against the farmer involved, but I gather that that farmer has already been prosecuted four times. The water authority suggested that, when dealing with the overall issue of pollution, it might be wise to consider a provision for an injunction procedure as opposed simply to dealing with incidents on an ad hoc basis through prosecution.
In moving the amendment I put down a marker of continuing concern. I know that the Minister has expressed his own anxiety about these problems. I hope that he will note my suggestion, listen to the debate and, I hope, return with something before the final proceedings on the Bill.

Mr. Boateng: The hon. Member for Daventry (Mr. Boswell) is, in more ways than one, the carthorse that comes along after the Lord Mayor's show. Not only does the hon. Gentleman follow through today's proceedings and the major debate that we had on previous amendments, but he picks up, in identical terms, the amendment tabled by my hon. Friend the Member for Copeland (Dr. Cunningham), which I moved in Committee.
This is a modest little amendment. Committee members may remember that we proposed it in a spirit of good will —there was not much acrimony or argument between the parties, although such days did exist. To give Jack his jacket, the Minister responded in kind, which is why we look forward to hearing from him what positive steps he plans to take, having had time for mature reflection.
This is an important little amendment because it seeks to overcome a gap in the existing law and the fact that the present site regulations on waste disposal are seriously defective. The amendment says that there should be no exception from prosecution if the discharge of polluting waters takes place from the site where a disposal licence has been given under section 5 of the Control of Pollution Act 1974. It is as simple as that, and is not—as was rather uncharitably suggested by the Minister before he fully appreciated the purport of the amendment—a duplication of controls. The amendment does not require the water authorities' controls to be applied through both the waste disposal licence and the discharge consent. He was concerned about that and said that he was not persuaded that anything was to be gained from such duplication. Nothing would be gained, which is precisely why the amendment does not propose such duplication.
The amendment merely says that there should be no automatic exemption where leachates discharge to land or percolate through surrounding rock strata and pollute the water supply. In such a case the prevention of pollution is clearly intended to be covered by the waste disposal licence. There does not appear to be any undue difficulty in stating that an offence could still occur in such circumstances, when, because of the gap in the existing laws—due to the withdrawal by the Local Government, Planning and Land (No. 2) Act 1980 of the powers to issue


regulations under section 6 of the Control of Pollution Act 1974—it is possible for abuse to take place and for the public to be without proper remedy. That has happened.
The result of the unintended gap in the law is that a waste disposal authority can bring criminal proceedings against a discharger of pollutant only if waste has been deposited when the pollution is taking place. The chance of a waste disposal officer happening to visit the site just as this was occurring, who was able to give evidence that, as the waste was deposited the leachates or overflow was occurring, is—as you, Madam Deputy Speaker, could imagine, if you were to apply your mind to such an unpleasant course of events—unlikely to result in many successful prosecutions.
We are told that the reason for the gap between the Committee and Report stages is to allow the Minister time to reflect and to consult his advisers. I notice that not many papers have been passed to the Minister during the speech of the hon. Member for Daventry or during my speech. I see the Minister pointing to his head: that is only small consolation. I do not want to be offensive to the Minister, but we can take only small satisfaction from his gesturing to the size of his cerebral matter. In any event, I hope that the absence of passed notes denotes that the amendment is wholly acceptable and in the public interest.
10.45 pm
Unanimity has broken out in the House, as it did in Committee. We hope the Minister will respond in the spirit that has caused that unanimity to break out.
We want to give the Minister a warning. When we moved the amendment in Committee, we wanted to give him a lifeline. He was getting himself into hot water at the time—scalded is the word that springs to mind. He is not unaccustomed to that, but we wanted to give him a way out. We wanted him to be able to show that he was, after all, the consumers' friend, a man genuinely concerned about the environment. So we offered him this simple, easy little amendment in a spirit of helpfulness. In Committee, he put his hand halfway out; we should like him to stretch it right out tonight.
The Minister should bear in mind the warning given by the Earl of Rosebery all those years ago at the time of the formation of the London county council. It concerned the significance of water in the affairs of our nation.
Water",
he said,
is one of those points which have wrecked a powerful government before now and may wreck governments again.
The Minister should keep that in the forefront of his mind when considering his response to this little debate, and seek to salvage something from the wreckage.

Mr. Allen McKay: I brought a particular problem to the Minister's attention in Committee. We bottled the problem, to show what it was about. This amendment would deal with that problem in the future, although we can do nothing about the past.
The Minister promised to discuss with other Departments how to deal with this problem from the past. I refer to discharges from closed collieries. Yesterday we discussed the restructuring of the mining industry in Committee. When the Government talk about restructuring, they mean more closures. It is imperative that we deal with the problem now at its source. I want to ask the

Minister about the discharges from Bullhouse colliery. The Minister promised that he would discuss ways of dealing with that problem with the Department of the Environment.
We must recognise the extent of the Government's powers as a result of their majority in this House, but we should also recognise the power of the public who are speaking out openly against the Bill. If the Bill becomes an Act, the chances of the River Don being cleaned by British Coal or the NRA would be remote.
I spoke to Gordon Jones, the chairman of Yorkshire Water, and three of his four directors at 5 pm today. I was tied up in the Chamber for a while, but he told me that simply to clean the river to comply with EC standards on drinking water would cost £140 million. That gives us some idea of the massive task facing a privatised Yorkshire Water. There will be little room for financial manoeuvre to clean up the river. The river can be cleaned. I have examined the minutes of meetings held by South Yorkshire county council to discuss the problem. It admitted that it would be a costly process. It would cost about £300,000 to be effective and would require running costs of around £130,000 a year.
That may seem a lot of money to clear that stretch of the river, but correspondence from a constituent of mine, Mr. S. N. Crofts, puts the matter into perspective. Mr. Crofts, who has been following our proceedings very carefully, wrote to me on 9 January expessing his concerns about the Bill. In his latest letter he says that he has not written since then because all kinds of things have been happening in the House, which is true in many respects. Mr. Crofts brings to my attention a list of companies which are regularly, under licence, discharging toxic waste into the River Don. That pollution is in addition to the discharges from Bullhouse colliery.
I am glad that Mr. Crofts has written to me. I will be visiting him because he has kept records since 1985 and has produced graphs which show clearly where and when the pollution occurs. That information would be very useful. He also provides the Yorkshire water authority with information about the river. As the secretary of the Salmon and Trout Association in south Yorkshire, he has a strong vested interest in the quality of the water. In his most recent letter, Mr. Crofts points out clearly what could happen if the river was cleaned up:
where industry or mine water does not affect the river and where trout and grayling abound along with kingfishers, dippers, moorhens and herons along with all the waterside plants when clean unpolluted water is available.
Amendment No. 98 would help to affect the river waters and improve the condition described by Mr. Crofts. This is a small amendment and it would reflect well on the Government if they would accept it. It would show that they are sincere in their views about the cleanliness of river water. I had hoped that the Minister would rise to accept the amendment because we had won through. If the Government will not accept the amendment, I hope that the Minister will provide an explanation. I hope that he will also explain what progress is being made with other Departments in relation to cleansing the River Don of the discharges to which I have referred.

Ms. Walley: I look forward to hearing whether the Minister has any assurances to give following our earlier discussions—which he has now had an opportunity fully


to consider—particularly as the amendment is in the name of his hon. Friend the Member for Daventry (Mr. Boswell).
If polluted discharges occur at a site where there is a disposal licence granted under section 5 of the Control of Pollution Act 1974, there should be no exceptions to prosecution. We acknowledge, as I trust the Minister does, the genuine concern that exists among the public that there should be integrated pollution control. The amendment addresses a loophole in the 1974 Act. If no opportunity is offered by the Bill to close it in respect of disposal sites and licences, there is a real risk that any future legislation resulting from the current consultation paper on waste disposal will, far from being integrated, be likely to go off at an even greater tangent. Existing legislation must be tightened up, and that tightening up should be reflected in the Bill also.
My hon. Friend the Member for Barnsley, West and Penistone (Mr. McKay) drew attention to the anxieties of those living in the vicinity of waste disposal sites, who are acutely aware of the problems that pollution creates. My hon. Friend the Member for Brent, South (Mr. Boateng) argued that the amendment is wholly acceptable and in the public interest. I urge the Minister to recognise that the Government's credibility, in claiming to be an Administration concerned about pollution control, is at stake.

Mr. Moynihan: The debate has been helpful, not least in respect of the poetic contribution of the hon. Member for Brent, South (Mr. Boateng) who, in characteristic style, sought to ensure that I extend my arm further towards the arguments made by both sides of the House and accept the amendment. I can tell the hon. Gentleman that my arm, which is already half extended, is moving rapidly towards the three quarter mark. I say that, because the points made by hon. Members were important and relevant, and because I recognise the water authorities' concern that existing arrangements are not operating satisfactorily. That point was made also in Committee.
The only reason why I hold back from fully extending my arm is to be found in the remarks of the hon. Member for Stoke-on-Trent, North (Ms. Walley). My hon. Friend the Member for Daventry (Mr. Boswell) made the House aware that the Environment Committee has just published its report on toxic wastes, which deals with waste disposal sites and has an obvious bearing on the subject. We have not yet finished studying that report. Moreover, in the context of proposals for integrated pollution control, consideration is still being given to the overall regulation of waste disposal sites and to the links between land and water pollution.
We are still carefully considering the implications of policies affecting the issues that are the subject of the amendment. However, I assure the House that we are keen to ensure the best practical protection of water quality from pollution by waste disposal and landfill sites. If further strengthening is possible in the context of the Bill, we shall pursue it.
The hon. Member for Barnsley, West and Penistone (Mr. McKay) raised an important point about discharges from collieries, particularly the Bullhouse colliery. I had the good fortune to discuss the matter with him, and I mentioned that I would provide him with comprehensive answers and additional information about the grants we were discussing in Committee. I shall hurry that along in

view of his wish to pursue that constituency matter. I assure him that I will get back to him as soon as I possibly can.

11 pm

Mr. Boswell: As the Minister has extended his arm three quarters of the way to meet the issues that we have raised, I am prepared to wait one quarter longer for his final decision, in the confident hope that it will be a positive decision taken before the end of the passage of the Bill. In that spirit, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Moynihan: I beg to move amendment No. 64, in page 112, line 9, after 'public', insert—
`( ) that person takes all such steps as are reasonably practicable in the circumstances for minimising the extent of the entry or discharge and of its polluting effects;'.
I do so with confidence, because my hon. Friend the Member for Daventry (Mr. Boswell) welcomed the amendment when he saw it on the Amendment Paper and I am sure that it will be welcomed by Opposition Members.
Clause 104(2) provides that a person shall have a defence to a charge of polluting rivers and other controlled waters if he can show that the polluting discharge or entry was made in an emergency to avoid danger to the public.
The Government consider that that defence, which reproduces the existing provision in the Control of Pollution Act 1974, should be subject to an important condition. A person should be able to plead such a defence only if he can demonstrate that he has taken all reasonably practicable steps in the circumstances to minimise the discharge and its polluting effect. That is provided in this tightening-up amendment.
Even in the case of an emergency discharge, discha.rgers should have a clear obligation to do all they can to minimise the effects of their discharges. It will make a further small, but important and useful, contribution to a more effective system of pollution control, and I commend it to the House.

Ms. Walley: There is some concern that amendment No. 64 could be interpreted as a get-out or let-out provision. It is important that the Minister gives us some idea of what he means by "reasonably practicable". How subjective will that assessment be and who will judge whether something is "reasonably practicable"? Is the Minister concerned about whether the general public will consider something to be "reasonably practicable"? Will an action have to be "reasonably practicable" in the view of the water companies or in the opinion of Her Majesty's inspectorate of pollution which has been grossly under-resourced in terms of staff and so on?
The amendment appears to be highly subjective. The Minister needs to give the House some assurances on where the principle that the polluter pays fits into the amendment. For those reasons we seek further clarifica-tion from the Minister as to the purpose of the amendment.

Mr. Boateng: The uncharitable might believe that my hon. Friend the Member for Stoke-on-Trent, North (Ms. Walley) was being somewhat carping in her response to the Minister who has come to the Chamber at this time of night to move such an amendment. They would be deeply misguided in that view. The points that my hon. Friend


raised have to be taken on board, because, sad to say, experience has shown that the water companies, which are to be regulated and controlled, and are subject to the legislation might seek to use the defence that the Minister has provided in the amendment. Those self-same water companies agree with Mr. Keith Court, who is chairman of South West Water. I note that the Minister for Water and Planning is even more languid than usual. One might think that he is the last Minister who can afford to be languid. He flings himself back on the Bench—were the cameras only present—a smile hovering on his lips, with mute resignation playing around those pearly gates.
Mr. Keith Court said:
High calibre staff will be needed to outwit the regulators of the water industry after privatisation.
Those high-calibre staff will no doubt be paid the high sums mentioned quite properly by my hon. Friend the Member for Bootle (Mr. Roberts).
If high-calibre staff are to be employed to outwit the regulators, it is vital that the question that we have asked is answered. There are circumstances in which a defence such as that provided by the amendment should properly exist. There should be a defence in an emergency, but what is meant by an "emergency"? In what circumstances does the Minister foresee that it would be reasonable for the polluter to draw himself or herself within the ambit of the defence?
That question becomes more important when one reflects on how existing law is administered and applied by the courts. Widespread concern has been expressed by not only Labour Members but Conservative Members about some interpretations of pollution control law, the fines imposed and the latitude that is sometimes extended to the polluter. We hoped for—I am sure that it is a hope shared by all reasonably minded people—the greening of the magistracy so that it might become more vigilant.
That is not an unreasonable hope, but Labour Members are not prepared to rely on hopes, which dominate the thoughts of Conservative Members. They hope that regulation will be effective and that somebody will purchase shares. We are not content to rest on hope; we want some certainty, which the Minister has not provided. When we receive that certainty, he may find that Labour Members are prepared to take a reasoned attitude to the amendment.

Mr. Richard Livsey: The hon. Member for Brent, South (Mr. Boateng) omitted to mention the charity that might be offered by the amendment. That might be a let-out for polluters. I hope that it is not, but if one examines the amendment carefully a number of questions arise.
As the hon. Member for Brent, South rightly said, an emergency has not been accurately defined. Will the words "reasonably practicable" be defined? What steps should be taken when an emergency occurs to prevent it getting out of hand? The word "minimising" could also have various interpretations. One would have thought that "prevent-ing" would have been better than "minimising". I trust that my suspicions will be dispelled by the Minister. I hope that he will be able to convince me that the use of those words is specific and that he can explain their meaning in detail so that we can all be reassured.

Mr. Moynihan: It is in the nature of an emergency that it is impossible accurately to define what it will be. It is absurd for Opposition Members to suggest that the Bill could describe in detail a range of possible emergencies to back up the case. If an accident occurred, for example, at a water treatment plant and chemicals used in the treatment process got into the water, the water plc would have to make a decision as to the most important step to be taken in the light of public health. The company might conclude that the best step to take would be to discharge the affected water into the water course rather than allow it to find its way into the system. The company might not need to make that decision, but it is impossible to predict accurately all the factors that would need to be assessed in an emergency.
As the hon. Member for Brent, South (Mr. Boateng) so accurately stated, it is important that proper provision is made for an emergency, but it is rich indeed for the hon. Gentleman—a distinguished lawyer in his own right—to wish to define in greater detail the long-standing defence of "reasonably practicable". [Interruption.] There is a certain amount of barracking about whether the hon. Gentleman is a distinguished lawyer—a highly paid lawyer might be a more accurate description.

Mr. Boateng: Get on with it.

Mr. Moynihan: Suffice it to say, in the last two minutes of this debate, that it is for the courts to make the judgment in the light of all the circumstances. That is the key point. We seek to tighten the defence available before the courts by bringing forward amendment No. 64.

Amendment agreed to.

Orders of the Day — Clause 126

GENERAL DROUGHT ORDERS

Amendment made: No. 35, in page 127, leave out lines 16 to 24 and insert—
'(5) The following provisions apply where an order under this section contains a provision authorising a water undertaker to prohibit or limit the use of water, that is to say—

(a) the power may be exercised in relation to consumers generally, a class of consumer or a particular consumer;
(b) the water undertaker shall take such steps as it thinks appropriate for bringing the prohibition or limitation to the attention of the persons to whom the prohibition or limitation will apply and, in particular, shall (as the undertaker thinks appropriate)—

(i) cause notice of the prohibition of limitation to be published in one or more local newspapers circulating within that part of the water undertaker's area which would be affected by the provision of the order; or
(ii) send notice of the prohibition or limitation to the persons to whom the prohibition or limitation will apply;

(c) the prohibition or limitation shall not come into operation until the expiration of the period of seventy-two hours beginning with the day on which the notice is published or, as the case may be, sent to the person in question:.—[Mr. Moynihan.]

Orders of the Day — Clause 136

FUNCTIONS OF AUTHORITY IN RELATION TO FISHERIES

Mr. Cranley Onslow: I beg to move amendment No. 78, in page 139, line 1, leave out `advisory'.

Madam Deputy Speaker: With this it will be convenient to take the following amendments: No. 79, in page 139, line 1, leave out
'who appear to it to be'.
No. 80, in page 139, line 5, at end insert—
`and to delegate to them such powers and duties as it may from time to time think fit'.
No. 153, in page 139, line 5, at end insert—
'(2) The chairmen of the regional committees shall be appointed by the Minister in consultation with the Authority.'
No. 81, in page 139, line 6, leave out 'advisory'.
No. 82, in page 139, line 9, leave out 'advisory'
No. 83, in page 139, line 13, leave out 'advisory'.
No. 85, in page 139, line 15, at end, insert—
'(2A) There shall be appointed by the Authority for each area, a Chairman who has an interest in the fisheries within the area and members nominated by riparian owners and anglers representative of rivers and still waters within the area. The number of members appointed shall not exceed twenty and will vary according to the extent of the fisheries within the area'.
No. 84, in page 139, line 17, leave out 'an advisory' and insert 'a'.

Mr. Onslow: I do not want to delay the House, so I shall be brief as possible. I should first declare an interest. I am a riparian owner, in a small way. I have been a keen fisherman for many years, I have fished in many parts of the British Isles and I sit on a number of bodies that represent anglers collectively such as the Anglers Co-operative Association, the Salmon and Trout Association and the British Field Sports Society. The points that I want to make are not mine alone, but are shared by many anglers. I hope that the Minister will be able to reassure them.
The most important amendment of the group is No. 80. I shall concentrate mainly on that, with a few words about amendments Nos. 153 and 85. The others are purely consequential.
I hope that the House will agree that amendment No. 80 has three things to commend it: it would improve the representation of anglers in fishery matters; it would improve the management of fisheries, and it could, I think, be accepted without damaging a principle that the Government hold dear, which is that the National Rivers Authority should not be undercut by having its powers limited by decision of Parliament. The powers of the NRA will derive from the House, and some hon. Members may feel that it should have more, but my argument will relate to the NRA's use of powers that we know it will have, one of which is the power to levy charges on anglers and owners and occupiers of fisheries through licences or other means.
I invite the Minister to anticipate Government amendment No. 5, which we may or may not get a chance to debate in the later stages of the Bill. He will at least agree that that sets out clearly that the NRA will have considerable powers to levy charges. It does not say how the money is to be spent or who is to spend it, but I am nevertheless attracted by the proposition that those who

contribute should have some say in deciding how the money is to be spent. I hope that the Minister will agree that that proposition is basically a democratic one and accept its corollary, which is that they can have such powers only if they are delegated to the regional fisheries committee, on which we hope and believe anglers will be powerfully represented. It is hard to envisage what checks there will be on the NRA's fisheries activities if that does not happen.
While I have no quarrel with the choice of Lord Crickhowell as chairman-designate of the NRA and I am glad to discover that Lord Mason is to be at his elbow —and I know both of them to be keen and experienced anglers—we cannot look forward with confidence to keen and experienced anglers always occupying those positions. We must anticipate circumstances in which it might, more than ever, be necessary for anglers to have more say in the management of their fisheries.
A number of anglers are not as confident as one would wish them to be that all will be well under the proposed NRA structure. Broadly speaking, the anglers support the Bill, for very good reasons. They have always been in the forefront of the fight against pollution, and they regard the separation of the powers of the water authority as managers and the NRA as inspectors as an important step forward. It would be wrong, however, for Ministers to suppose that all anglers take an entirely rosy view of the future. In that context, I can do no better than to quote from a letter sent by a keen and experienced angler who has considerable reservations about the circumstances that will prevail once the NRA is established:
The Regional Organisation at present envisaged is simply a carbon copy of the existing W.A.'s perpetuating most of their faults and even introducing new ones
He adds:
it is absolutely certain that the legal obligation of the present W.A.'s and the future N.R.A. to maintain, improve, and develop fisheries has no chance whatever of being fulfilled without River Catchment Fishery Committees with executive powers.
The justification for this categorical statement is simply that the Fishery Organisation of the present W.A.'s has not always proved satisfactory because the Fishery Function was far too small and often considered unimportant in far too large an organisation for anyone of importance to take any interest in it. Officers, at least in some W.A.'s, have therefore been able to ignore Advisory Committees and to take decisions—or fail to take decisions—in situations that they really did not understand. Experts are dangerous unless they are responsible to an informed and confident lay committee. They need to be questioned and forced to justify their case".
Of course, in the House we spend our time questioning and seeking Ministers' justification for their cases. I hope that Ministers would not object to that pressure. I hope, therefore, that the Minister will not think that this is too much to ask of the NRA.
The letter goes on:
Fisheries may be very small compared with most of the other proposed functions of the NRA, but from the point of view of recreation, conservation and the environment they are most important.
I do not believe that any hon. Member would challenge that view. I hope, too, that there is general agreement with the proposition that anglers are entitled to a real opportunity to make constructive contributions and to participate in the management of the fisheries that they value and enjoy.
I said earlier that I realised that the Government were anxious not to devalue the NRA by shackling it. If that is what they fear the amendment will do, I hope that they will


think again. I certainly hope that the amendment will be used, but it will be for the NRA to use it. I hope that it would willingly and freely delegate powers. I do not believe that it will be jealous and will want to keep the power to itself. I hope that there are not bureaucrats in water authorities' fishery management who will consider that they will have some cosy billet that they can look forward to enjoying, without anyone having any real control over what they do or how the money is spent. I can see no objection to the proposition that the NRA should be empowered to delegate some of its functions to executive regional fishery committees.
Amendment No. 153 is self-explanatory. I am sure that the Minister of Agriculture, Fisheries and Food would like a say in the appointment of officers in the NRA, if only so that he can remain accountable to Parliament.
Amendment No. 85 is simply probing, because I hope that the Minister can indicate how many people and what sort of people he expects will comprise the fishery committees. They should be committees that will be capable of exercising power, even if we do not necessarily feel that they must change their name. Whether we are talking about shooting or matters connected with fishing, we should make it clear that we expect the committees to be noticed. I am afraid that there is some reason to suppose that, when they are given an advisory label—as often happens—they will not be noticed at all.

Mr. Livsey: Being an angler, I welcome the amendments. Anglers have a great interest in the environment and the purity of water, especially of rivers. I believe that after the Committee stage anglers felt that they were under-represented on the NRA. That was the principle of no taxation without representation. Anglers, after all, who are paying considerable sums of money to enjoy their sport, should be recognised. Indeed, in any delegation of powers to regional authorities anglers should have a proper say in fisheries. The feeling is that they have been shut out in the cold. That is unfortunate, because, if anglers were given the opportunity of executive powers to help develop fisheries, that would have great significance. I believe that that is one of the aims of the amendments.
To be effective fisheries management must be proactive, and actions such as stocking the rivers with migratory fish such as salmon, sea trout and the like are vital. There is no doubt that our fishing resource is undeveloped and that what exists has substantially deteriorated over the years. There is great work to be done to revive the fisheries in many of our rivers. The expertise that our anglers could provide in that respect could be significant not only in creating a better resource for sport, but in developing tourism and employment opportunities in rural areas.
Not long ago we spent some time discussing the Salmon Bill and we thought that we had improved matters. However, unless the advisory committees to the NRA have executive powers, angling interests will suffer a considerable setback.
We all know that angling is the most popular recreation in the United Kingdom, with about 3 million participants. The Bill provides a great opportunity to develop that resource. After all, angling is a pleasant, quiet occupation which is in tune with the environment. Advisory

committees which represented angling interests and had executive powers would bring benefit to the rural areas and the waters that flow through them.

Sir Charles Morrison: Nothing that I say should be taken as a criticism, direct or by implication, of Lord Crickhowell, the chairman-elect, if that is the right description, of the NRA. There is only one weakness in Lord Crickhowell and that is that he is not immortal. That is why I am concerned about the Bill as presently drafted.
In common with my right hon. Friend the Member for Woking (Mr. Onslow) I declare an interest—not as a riparian owner, but as an angler, particularly as I happen to be president of the National Anglers Council. That council claims to represent the millions of anglers of the United Kingdom and their families, who are extremely concerned. The fundamental reason for that concern is that they believe, as I do, that advisory committees have a limited useful life. What will ensure that the NRA will pay any attention to an advisory committee? All too often, advisory committees become a facade to which less and less attention is paid or, in this instance, needs to be paid.
There is nothing in the Bill to suggest that the NRA must pay any attention to the advisory committees. All the Bill says is that those committees must be consulted. To start with, I suspect that will mean something, but as time goes by, it will mean nothing.
Clause 136(1)(a) imposes a duty on the NRA to
maintain, improve and develop salmon fisheries, trout fisheries, freshwater fisheries and eel fisheries
What does that mean, precisely? It may mean a great deal to the chairman-elect, Lord Crickhowell, but to his successor that duty may mean little or nothing, or no more than a statement to demonstrate that he is living up to his duty. If the committees established by clause 136 are to mean anything permanent, it is essential to make them more important and give them greater executive power.
This is emphasised by the fact that much of the funding for fisheries will come from the anglers and riparian owners. They should therefore be represented in a more executive role than is envisaged, and the committees should be strengthened in the Bill. Those committees should not be composed of people whom the NRA considers to be interested in the issues involved. They should have a definite interest in those issues, as is made clear in the amendment. The committee chairmen should be appointed by the Minister with responsibility for fisheries, and not by the NRA, which may have a vested interest in having a weak person, or even a placeman, at the helm.
After all, these committees amount to quangos and could be a nice way of pensioning off some good party hack who seems to have done his bit over the years. The chairmen of these committees should be appointed by the responsible Minister, and that would ensure that the chairmen and committee members would not act entirely in accord with, and comfortably alongside, the NRA.
Each committee should be a consistent and continuing gadfly in the side of the NRA, and for that to happen, the NRA should not be responsible for appointing the membership and the chairmen and for consulting them, which, as I say, could mean something or nothing. I hope that the Minister will give this issue further thought, if he cannot accept the amendment.

Mr. Allen McKay: In debating an earlier amendment I mentioned my constituent Mr. Crofts, who is chairman of the South Yorkshire anglers association. I quoted from a letter he sent me, but I omitted a part of it that is relevant to the issue we are now discussing.
I hope that the Minister has noted that, despite the lateness of the hour, we have a coalition of Back Benchers in favour of the amendment. I agreed with everything that the right hon. Member for Woking (Mr. Onslow) said about anglers and, not being an angler, I can stand back and take a dispassionate look at what the angling associations do.
My local authority has approached anglers on many occasions to seek their views about the quality of the rivers and similar matters. We have always found them extremely helpful, and their services are given free. The amendment would not cost anything to implement, so the Government cannot accuse us of demanding large sums of money, an accusation that they have made during our consideration of the Bill.
My constituent Mr. Crofts refers in his letter to the whole stretch of the River Don down to below Sheffield. Using his own time and money and by his own efforts, he uses information from the water authority sampling stations to keep a check on that stretch of river. He does that because, as an angler, he is interested in the conservation of the countryside and, in particular, of our waterways. He writes about the wildlife that he comes across and the plant life at the side of the river. He gives a report to Yorkshire Water, exactly as suggested in the amendments. We can give such people a place as of right under the Bill. That is all the amendments are asking for.
Another of my constituents who has written to me has always been a conservationist. He is a farmer and a landowner. He is a lawyer and also a member of the Labour party. He is a very commendable person. He is also an educationist. He is an environmentalist, as are both his sons, who are interested in angling. Someone wants a piece of his land to set up a piggery, so he could make a substantial amount of money by selling the land. He will not sell it, because he does not wish the river to be polluted by the discharge from a piggery; also, he does not think that a piggery would be a good thing environmentally. Although he could make a lot of money, for the sake of angling and river quality, he has decided that the land is better left as it is.
British Coal has a lease on part of his land for the next 99 years. Although the board has finished with the land, he refuses to release it, because within the lease it has to keep the river clear and clean. Water has to be pumped from the old workings so that it does not pollute the river.
Those constituents have adopted a commendable attitude. They would be an asset to Yorkshire Water and to the environment if the amendments were accepted. I accept the arguments that have been put from all sides of the House. The Minister should take note of these constructive amendments that would strengthen the National Rivers Authority. Unless it is well funded, it will not have teeth. The amendments would strengthen it, without extra funding, and would make it more acceptable to the great body of conservationists who look after the environment and enjoy their fishing at the same time.

Mr. Boateng: I was concerned at the rather unseemly outbreak of consensus among the parties, but when I saw the hon. Member for Crawley (Mr. Soames) making his entry I knew that any hope of consensus had gone out of the window. I expect numerous interventions from the hon. Gentleman in his usual, firmly sedentary position, but he may yet surprise us and manage to contain himself. We shall have to see.
I do not want anything that I say to break the consensus that has emerged. I do not have an interest to declare. I am not a riparian owner. My little plot is some half a mile away from the river in Brent. In a borough where much changes, the river seems to be firmly established and is not likely to come my way.
I am very fond of fish, not just for their culinary attributes but because they play an enormously important environmental role. They are environmental barometers. When the fish start to go a little green about the gills or, worst of all, upturn altogether, it is obvious that something is wrong with the water.
My fondness for fish extends to fishermen and all who are connected with angling, of whom there are large numbers in my constituency, which falls within the boundaries of the Mid Thames Fisheries Consultative Council. It is the particular concerns of that council that I am anxious to share with the House this morning.

Mrs. Ann Taylor: Evening.

Mr. Boateng: It is evening now—it will be morning shortly. I do not wish to anticipate how long I shall take to share with the House the concerns of the Mid Thames Fisheries Consultative Council.
Needless to say, within the boundaries of the council there falls the middle section of the River Thames, from Cleeve lock to Mosley lock, including the main tributaries —the Rivers Kennet, Lauden, Pang and Wey, and the rivers running into them, the Whitewater, the Blackwater, the Lambourn, and so on. Amongst those, I might add, is the river Brent. It s possible that some 80,000 to 100,000 anglers use those waters in the course of a year. The Mid Thames Fisheries Consultative Council does a splendid job and is represented on the regional fisheries advisory committee at Thames Water. It is precisely because of the job that that body does—the service and benefit that it provides to anglers—that I wholeheartedly support the amendment.
There are a number of issues that the Mid Thames Fisheries Consultative Council is anxious that we should have at the forefront of our minds in considering the merits of these amendments. Its concern about water obstruction is very real. It is anxious that there should be a review of water obstruction licences and that, wherever possible, they should be withdrawn. If feels, with cause, that within the Thames Water region there are sufficient licences to take out more water than is available. Fortunately, the CEGB does not demand its full capacity, but obstructions are having an adverse effect on the streams. Some have been lost, and rivers have been downgraded in terms of water flow.
It is on precisely this sort of issue that anglers and fisheries interests are well able to bring their particular expertise and concern to bear. As has been said by hon. Members in all parts of the House, one does not want a situation in which those people are relegated to a merely advisory and consultative role. There is a part for them to


play in monitoring the environmental quality of our rivers, and they should be encouraged and assisted, as these amendments seek to encourage and assist them, to that end. River quality objectives are also a matter of concern to my angling constituents and their council. They are concerned that, at present, the quality of our rivers is determined against a set of criteria which include both chemical and biological components.
It is believed that, if fisheries are to flourish, with properly structured ecosystems, those criteria ought not to be downgraded. In particular, there is concern about the biological element and about the importance of ensuring that, because the chemical criteria can be met in water conditions incompatible with fish, the biological criteria must be taken on board. Those people want to see the river quality objectives protected and, wherever possible, enhanced. If the amendments are accepted, as I hope that they will be—I hope that the Minister will at least take some steps in that direction—interested bodies would be in a position to ensure that the river quality objectives are protected.

Mr. Nicholas Baker: I hope that the hon. Gentleman will accept an invitation to come down to Dorset with me, with or without his five children. I will show him the River Allen, which has exactly the problems of over-abstraction that he has described. I was therefore interested to hear what he had to say.

Mr. Boateng: I shall be delighted to come down to Dorset, with my five children whom the hon. Gentleman was kind enough to mention—[Interruption.] From a sedentary position, the Minister of State expresses concern that they might be disciplined in a car park. I assure him that that occurs but rarely, and I am sure that the hon. Member for Dorset, North (Mr. Baker) would not take us anywhere near any car parks. Moreover, I am confident that we shall be able to regulate the children's behaviour in the ordinary way, which does not involve disciplining in car parks—it involves a hard stare, with the promise of discipline to come if they do not respond to the stare. That is how one deals with children. I am sure that that view strikes a chord with a number of Conservative Members —[HON. MEMBERS: "In the Whips Office."] I do not wish to be sidetracked, least of all down the avenue of the Whips Office.
It is important that we should recognise exactly what is happening in some parts of the River Thames, especially the mid-Thames which affects my constituents in Brent. I will give the House just one example which has been drawn to my attention by the Mid Thames Fisheries Consultative Council. The native cray fish has virtually been destroyed by the disease brought in by the single cray fish——

Mr. Onslow: If the hon. Gentleman would read the brief properly, he would realise that it is the signal cray fish. May we please have an end to this and a reply from the Minister?

Mr. Boateng: I resent that intervention as the Mid Thames Fisheries Consultative Council has done its best to provide me with a proper and accurate briefing. A simple typographical error is no cause for the hon. Gentleman to sneer. He should not imagine that anglers come only from

the country interests that he so stoutly represents. There are many urban anglers and I am determined that their voice should be heard today. Urban anglers are extremely concerned about the cray fish and about the spring viraemia of carp which has forced the closure of a local fishery. A ban exists at the moment——

Mr. Morley: I wish to reinforce my hon. Friend's remarks about the way in which anglers are spread across a wide spectrum of society and regions. I received letters from the Appleby and Froddingham angling club, which was formed at the old steelworks and which has one of the largest memberships of any angling club in my region. Its members are all steelworkers and they have expressed many of the concerns that my hon. Friend has put so eloquently about water quality standards and the influence of the fisheries advisory committees. They feel that at present the fisheries advisory committees are not given the influence that they deserve.

Mr. Boateng: I am obliged to my hon. Friend, who has a wealth of experience in these matters which he brought to bear over many hours in Committee. We are grateful to him. He is right that this issue goes right across the board.
In conclusion, one wants a strong voice to be given to angling interests and to see them have proper representation, with means and resources to make their voice heard and to make it count, so that they can deliver the goods not only to anglers and fishermen, whether urban or rural, but to all of us who benefit from a safe, clean environment.

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Richard Ryder): As my hon. and learned Friends the Minister for Water and Planning and the Solicitor-General know, I have for a long time been an eager proponent of reform of our legal system. If I harboured any doubts about my desires for reform, they were dispelled by listening to the hon. Member for Brent, South (Mr. Boateng) who is—as my hon. Friend the Member for Crawley (Mr. Soames) acknowledges—a solicitor.

Mr. Soames: He is indeed.

Mr. Ryder: As a solicitor he deserves a wider audience. He is a powerful advocate and, if the Lord Chancellor's recommendations in the Green Paper ever come into law, the hon. Gentleman will do very well out of them.
Many important points have been raised during our brief debate, and related issues have also been brought to the fore by the amendments of my right hon. Friend the Member for Woking (Mr. Onslow) and my hon. Friend the Member for Devizes (Sir C. Morrison). The debate will be followed by not only anglers but others who have interests in fisheries. In the remaining time available to me I shall try to answer some of those points.
My right hon. Friend the Member for Woking was concerned that, in the past, fisheries had had too small a voice in the water authorities. I take issue with him on that matter and I should certainly have to deny that that would be the case in the new National Rivers Authority. In addition to the regional fisheries committees, my right hon. Friend the Minister is to appoint a fisheries member to the main NRA board, and fisheries will be represented on the new regional rivers advisory committees.
Fisheries will, and must, in recognition of their importance, have a powerful voice. The Government have


no doubts about the importance of fisheries. That is why they want to ensure, through the Bill, that my right hon. Friend the Minister retains one appointment to the NRA board.
My right hon. Friend the Member for Woking was also concerned about the competence of the committees and the NRA to administer fisheries. I have heard that view expressed before, although not particularly widely. It was my impression that the water authorities, with the aid of their regional fisheries advisory committees, had exercised their fisheries function admirably in the past, and I have every reason to believe that the NRA—as an important national body—will have an even greater opportunity to co-ordinate and develop fisheries policies, building on the sound foundation laid down by the water authorities.
My right hon. Friend the Member for Woking and my hon. Friend the Member for Devizes tabled a number of amendments. I shall deal with each in turn. Amendment No. 153 aims to give my right hon. Friend the Minister more powers than envisaged under present legislation. Despite the fact that my right hon. Friend the Member for Woking and my hon. Friend the Member for Devizes intend, through the amendment, to give the Minister more powers, I cannot accept the amendment.
As I have said, the NRA will be an important and—I stress the word—autonomous national body, charged, among other things, with maintaining, improving and developing the salmon, trout, eel and freshwater fisheries in England and Wales. That will be the responsibility of the national corporate body. Of course, the NRA will discharge that responsibility through a strong, regional organisation—that is essential given the great diversity of our fisheries.
However, it will be for the NRA to decide the membership of its regional advisory committees, including their chairmen. I stress to my right hon. Friend the Member for Woking that Ministers will appoint members to the NRA main board. I have already referred to the one person to be appointed by my right hon. Friend the Minister for Agriculture, Fisheries and Food. He will co-ordinate the authority's regional fisheries advisory activity and will oversee the way in which the NRA's fisheries responsibilities are being discharged in each of its regions.
Amendments Nos. 79 and 85 would limit the membership of the regional fisheries advisory committes to people who are directly interested in fisheries in a particular area. I have to tell the hon. Member for Barnsley, West and Penistone (Mr. McKay) that the environmentalist to whom he referred would be excluded if the amendment were accepted. If we divided on it, he would have to vote against it.
Only anglers' representatives and riparian owners could be appointed. There would be no place for representatives of netsmen or fish farmers. It would not be possible, as has been the general practice, for the chairmen of the regional flood defence committees to sit on the committees. Nor would it be open to the NRA under amendment No. 85 to include environmental, scientific or any other interests on the committees. I believe that it is essential that the NRA should be allowed the maximum flexibility in establishing these committees to appoint relevant interests on a local basis, according to local needs and circumstances.
My right hon. Friend the Member for Woking argued that the powers to delegate fisheries to the regional

fisheries advisory committees would be entirely permissive. However, I would have considerable difficulty about accepting the principle that functions should be delegated to the committees, now or at a later date. The RFACs have always been advisory in nature. There has been no suggestion that this advisory nature has been ineffective in the protection of fisheries' interests in the water authorities. Indeed, I believe that the RFACs are widely regarded as having made a highly significant contribution to the conservation and management of fisheries by the water authorities.
The question to be addressed is this: how would things change for the better by delegating to the committees some of the NRA's functions? I am afraid that the case for that is still to be made. I am still unclear about what kinds of responsibility might be delegated and how the committees would effectively discharge those responsibilities.
Moreover, I fear that this may result in an undermining of the NRA at both regional and national levels as a new, cohesive and effective national autonomous body. It seems to me that fisheries' interests might not be best served by encouraging the degree of separation implied by specific and executive powers. The great thing about fisheries' interests in the water authorities—this will be much more so in the NRA—is the central role they have occupied in recreational and environmental matters. Fisheries cannot be divorced from water chemistry and quality, or land drainage and flood protection—or matters of access and river basin usage. My worry is that the amendments could tend to diminish that role and the freedom of fisheries' interests at all levels to act as an influence for the good of their own cause. We want the NRA to pull together a coherent national strategy for the maintenance, improvement and development of salmon, trout, eel and freshwater fisheries.
I hope that I have answered many of the points that have been raised by my hon. Friend the Member for Devizes. If my right hon. Friend the Member for Woking wishes, I will respond again.

Mr. Onslow: I am grateful to my hon. Friend for that reply. I am sorry that I have not been able to persuade him. In the certain knowledge that these matters can and will be raised again in another place, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment made: No. 10, in page 139, line 15, at end insert—
`and it shall be the duty of the Authority in determining the regions for which regional advisory committees are established and maintained to ensure that one of those regions consists (apart from territorial waters) wholly or mainly of or of most of Wales.'.—[Mr. Ryder.]

Orders of the Day — Clause 161

DIRECTIONS IN THE INTERESTS OF NATIONAL SECURITY ETC

Amendments made: No. 94, in page 161, line 16, leave out
`or the commercial interests of any person'.
No. 95, in page 161, line 21, leave out
`or the commercial interests of some other person'.—[Mr.Ryder.]

Further consideration adjourned.—[Mr. Chapman.]

Bill, as amended (in the Standing Committee), to be further considered tomorrow.

Legal Aid

12 midnight

The Solicitor-General (Sir Nicholas Lyell): I beg to move,
That the draft Legal Advice and Assistance (Scope) Regulations 1989, which were laid before this House on 3rd March, be approved.

Madam Deputy Speaker (Miss Betty Boothroyd): I understand that it would be for the convenience of the House if we discussed also the next two motions:
That the draft Civil Legal Aid (Matrimonial Proceedings) Regulations 1989, which were laid before this House on 3rd March, be approved.
That the draft Legal Aid (Functions) Order 1989, which were laid before this House on 3rd March, be approved.

The Solicitor-General: Perhaps it would also be for the convenience of the House if we discussed the six Opposition prayers:
That an humble Address be presented to Her Majesty, praying that the Legal Advice and Assistance (Duty Solicitor) (Remuneration) Regulations 1989 (S.I., 1989, No. 341), dated 3rd March 1989, a copy of which was laid before this House on 9th March, be annulled.
That an humble Address be presented to Her Majesty, praying that the Legal Advice and Assistance Regulations 1989 (S.I., 1989, No. 340), dated 3rd March 1989, a copy of which was laid before this House on 8th March, be annulled.
That an humble Address be presented to Her Majesty, praying that the Legal Advice and Assistance at Police Stations (Remuneration) Regulations 1989 (S.I., 1989, No. 342), dated 3rd March 1989, a copy of which was laid before this House on 9th March, be annulled.
That an humble Address be presented to Her Majesty, praying that the Legal Aid in Criminal and Care Proceedings (Costs) Regulations 1989 (S.I., 1989, No. 343), dated 3rd March 1989, a copy of which was laid before this House on 9th March, be annulled.
That an humble Address be presented to Her Majesty, praying that the Civil Legal Aid (Assessment of Resources) Regulations 1989 (S.I., 1989, No. 338), dated 3rd March 1989, a copy of which was laid before this House on 8th March, be annulled.
That an humble Address be presented to Her Majesty, praying that the Legal Aid in Criminal and Care Proceedings (General) Regulations 1989 (S.I., 1989, No. 344), dated 3rd March 1989, a copy of which was laid before this House on 8th March, be annulled.

Madam Deputy Speaker: I understand that there is no objection to that.

The Solicitor-General: All the regulations relate to legal aid or to advice and assistance. They are made under the Legal Aid Act 1988 and constitute a package designed to implement the Act from 1 April.
Within the framework of the 1988 Act this package will form the basis of the operation of legal aid for the coming years. Subject to a few specific exceptions, the regulations for the most part recreate the existing arrangements. However, the opportunity has been taken to carry out some measure of consolidation and revision and to give effect to some of the recommendations accepted by the Government in their White Paper on legal aid which foreshadowed the Legal Aid Act 1988. The regulations have been subject to wide consultation in draft.
The biggest change is that the responsibility for the administration of legal aid will pass from the Law Society to the new Legal Aid Board. I should like to take this opportunity to express the Government's appreciation of the service which the Law Society has provided to the

public in administering legal aid for nearly 40 years. It might also be appropriate at the same time to wish the Legal Aid Board well in taking up the functions that the Law Society is now relinquishing.
The most significant of the regulations are the Legal Advice and Assistance (Scope) Regulations which prescribe the scope of ABWOR—assistance by way of representation—as well as of green form assistance. In the White Paper on legal aid in 1987 the Government announced their decision that assistance in the making of wills and conveyancing should not normally be paid for out of public funds, and that they would take steps to restrict the green form scheme in those areas. In any publicly funded scheme such as legal aid the money available cannot be unbounded. It must, therefore, be directed to those areas where it is most needed and away from areas where there is a lesser need.
The Government have concluded that the use of green form advice and assistance to carry out a conveyance or to make a will are just such areas of lesser need. It cannot be right that the taxpayer should be asked to subsidise those who simply wish to arrange their own affairs. However, we have recognised that in particular cases there may be special needs and we have sought to ensure that hardship is not caused to vulnerable people as a result of the proposed change. Accordingly, the draft regulations contain a series of exceptions from the general exclusion of conveyancying and will-making from the green form scheme.
The Lord Chancellor's Department, following wide consultation, has provided that conveyancing services will continue to be available under the green form scheme in all cases where they are necessary in order to give effect to any court order, effect to the terms of a settlement in a divorce and to rental purchase agreements or conditional sales. Those are methods of house purchase where, unlike a purchase under a mortgage where the property is transferred immediately but acts as security for a loan, the ownership of the property does not change hands until the final instalment of the purchase money has been paid.
Participants in such transactions, who tend to be at the lower end of the housing market, can often find themselves in difficulties. Nevertheless, although the provision of conveyancing services is generally to be excluded from the green form scheme, I should stress that other forms of advice and assistance in relation to housing or land law are not. Thus, for example, a leaseholder concerned over his or her position under the lease may receive advice under the green form scheme. If, however, the advice is that some form of conveyance is required, the leaseholder will usually have to pay for that conveyance. In the area of will-making, advice and assistance will continue to be available for wills to be made by those aged 70 or over, by single parents wishing to appoint a testamentary guardian, by the physically or mentally disabled and the mentally ill, and by a parent or guardian who wishes to provide for such a disabled person.
The remainder of the scope regulations set out the extent to which ABWOR will be available. Subject to certain modifications, the regulations extend ABWOR to those areas where it is currently available. However, there are three differences. First, during the passage of the Legal Aid Bill the Lord Chancellor agreed that all child care proceedings should be treated in the same way for legal aid purposes. As a result, all child care proceedings attract legal aid under part VI of the Act, which is granted by the


court and not by the Legal Aid Board. Some of the proceedings relating to child care that now appear in part VI previously attracted ABWOR. As legal aid can now be granted by the magistrates court in question, ABWOR is no longer required and the regulations do not extend it to any of the proceedings for which legal aid is available under part VI.
The second difference concerns the duty solicitor schemes at magistrates courts provided under the Legal Aid Act 1982. Technically, those services constituted a distinct form of legal aid, that is "advice and representation". Under the Legal Aid Act 1988, "advice and representation" became part of ABWOR and the regulations therefore extend ABWOR to cover all representation within the scope of the existing duty solicitor scheme.
The third qualification relates to the granting of ABWOR by a magistrates court or county court. At present, a magistrates court or county court may approve the provision of assistance by way of representation by a solicitor who is at that time in the precincts of the court and whose client is not already in receipt of legal aid. Those arrangements bypass the normal mechanisms for the granting of ABWOR through the Law Society and are intended to provide for representation where it is required as a matter of urgency. The regulations will ensure that such arrangements will continue. However, the wording of the regulations has been revised to make it clear that ABWOR is to be made available by that means only in cases where there is a genuine urgent need and not as a form of routine provision of representation—as has been happening in some places—or as a means of avoiding the usual application procedures.

Mr. David Ashby: Will representation at magistrates courts still be available under the provisions of the Police and Criminal Evidence Act 1984 where there is extended detention?

The Solicitor-General: I think that the answer to my hon. Friend's question is yes, but I shall check and confirm that that is the case when I wind up.
The next set of regulations for which approval is sought are those reproducing the effect of the existing Legal Aid (Matrimonial Proceedings) Regulations 1977, which exclude civil legal aid from undefended divorce proceedings, subject to certain exceptions where full representation is required. The new regulations simply recreate the existing position.
The final measure requiring affirmative resolution is the Legal Aid (Functions) Order 1989. The Legal Aid Board's functions in relation to legal aid in criminal or child care proceedings are extremely limited. However, at present criminal legal aid committees of the Law Society may hear applications for review of a refusal by magistrates courts to grant criminal legal aid. They may also hear other applications in relation to the amendment or withdrawal of legal aid in criminal or child care proceedings and applications for prior authority to incur expenditure.
The order gives the Legal Aid Board the necessary power to enable its area committees to carry out the same functions. It will allow the existing arrangements to continue in effect unchanged. The order will also allow the Legal Aid Board to take over responsibility for the promotion and publicity of criminal legal aid. That function has hitherto been carried out by the Lord

Chancellor's Department. The board already has responsibility for publicity in relation to civil legal aid and advice and assistance.
Turning to the regulations that have been prayed against, the Civil Legal Aid (Assessment of Resources) Regulations generally seek to recreate the existing position and follow the current regulations closely. However, they contain the financial eligibility limits relating to civil legal aid that previously appeared in primary legislation. The Lord Chancellor increased a number of the legal aid financial eligibility limits relating to civil and criminal legal aid and to advice and assistance. Those increases are generally of the order of 4·7 per cent., which reflects the rise in the level of social security benefits. However, the capital limit above which civil legal aid is not normally available has been raised by 20 per cent. to £6,000. He has also increased the capital allowances made for dependants in assessing eligibility for advice and assistance by nearly 68 per cent. to £335 for the first dependant, £200 for the second and £100 for other dependants. The limits governing the amount by which an assisted person's resources may change before they have to be reassessed have been substantially expanded for both criminal and civil legal aid. There is no reassessment for advice and assistance.
The regulations also implement a recommendation of the legal aid advisory committee that the resources of cohabitants should be treated in the same way as those of married couples in assessing legal aid eligibility. Their resources are already treated in the same way for determining eligibility for social security benefits. The legal aid allowances available to spouses will now extend to cohabiting partners. That applies in both civil and criminal legal aid, and in advice and assistance.

Mr. Gerald Bermingham: Does the Solicitor-General agree that that will effectively remove a number of people from the legal aid system? Does he further agree that in cases in which the opposing parties are cohabitees, they will be effectively banned from legal aid?

The Solicitor-General: I certainly do not agree will the hon. Gentleman's first point. Extending to cohabiting partners the legal aid provision available to spouses can be beneficial, depending on the incomes of the respective partners.
The Legal Aid in Criminal and Care Proceedings (General) Regulations are the result of a consolidation exercise, but, again, seek generally to recreate the current position. However, they also introduce some useful reforms. They provide for there to be a single common and mandatory application form for criminal legal aid in the Crown court and magistrates courts. The use of that form should assist in the provision of uniform information and, together with revised guidance on the grant of legal aid, lead to a more consistent approach on the grant or refusal of applications.
As was announced in the White Paper in 1987, court staff are to be able to refuse as well as grant criminal legal aid. The arrangements set out in the regulations will enable a justices' clerk or the appropriate Crown court officer to refuse any application in the first instance. That will speed up the process of handling applications and lead to applicants receiving earlier notification of the decision. However, the existing arrangements for appeals against


refusal remain and will continue unchanged, and an application may be renewed to the court at any time. Officials will not be able to refuse applications after the first time. The regulations also provide that only judges may make or refuse a legal order for the assignment of more than one counsel, subject to a limited exception in respect of the magistrates court, and may have regard to the choice of the assisted person.
The Legal Advice and Assistance Regulations relate to ordinary green form, ABWOR and the duty solicitor schemes in magistrates courts and at police stations. I have already mentioned the regulations which relate to the scope of advice and assistance and which require an affirmative resolution. Because of the need to deal with scope in separate regulations, the Legal Advice and Assistance Regulations which do not require affirmative resolution have had to be recast and as a result have a new appearance, but, for the most part, they have the same effect.
However, the House may know that the Lord Chancellor has agreed to the raising of the administrative cost limits for the green form scheme from its present £50, or £90 for the preparation of a divorce petition or judicial separation. The regulations now set the limit as the equivalent of two hours' preparation work, or three hours in connection with divorce or judicial separation. That means that in 1989–90 the cost limits will now be £73 and £109·50p respectively for most of the country and £77·50 and £116·25 in London. Moreover, the £50 limit applicable to advice and assistance at police stations in respect of non-arrestable offences has been abolished. All advice and assistance at police stations will now attract the higher and extendable limit.
The Civil Legal Aid (General) Regulations from which the Opposition have withdrawn a prayer give effect to the Government's decision, announced in the White Paper, that solicitors should be required to certify to the Legal Aid Board that public funding for the case is still reasonable when applying for a payment on account. It is intended that the report from solicitors should be required 18 months from the date on which the legal aid certificate was first issued—18 months being the limit on which an initial payment on account can be sought. It is therefore proposed that the Legal Aid Board should automatically send out to a solicitor a request for a report at the same time as it advises the solicitor of the entitlement to make a claim for payment on account. The regulations repeat the effect of the recent regulations which permit the postponement of the enforcement of the statutory charge in appropriate cases and the payment of interest on the postponed sum. They do not extend the scope for postponement beyond those cases already provided for.
The remaining regulations prescribe the rates of remuneration for solicitors providing advice and assistance at police stations and duty solicitor services at magistrates courts, and for the rates of remuneration payable to solicitors and barristers undertaking criminal and child care legal aid work. These rates also apply to ABWOR and to civil legal aid in the magistrates courts. The rates payable are to be increased by 6 per cent. from 1 April. Moreover, duty solicitors who attend magistrates courts on Saturdays, Sundays and bank holidays will in

future be paid at an enhanced rate, and new and higher rates of remuneration are introduced for solicitors undertaking child care work in the magistrates courts.
The regulations have inadvertently created an anomaly whereby a duty solicitor who provides assistance by way of representation in relation to a warrant of further detention in unsocial hours will be paid less than he is now. As a result the Lord Chancellor will be making further regulations, to take effect from 1 April, to rectify that anomaly.
The rates of payment for legal aid work have been set following extensive discussions with both sides of the profession. In reaching a view on the increase to be awarded this year, the Lord Chancellor took into account the factors set out in the Legal Aid Act 1988.
Overall, the proposed package forms a sound basis for the future operation of legal aid and contains some useful reforms. I invite the House to approve the three draft instruments laid before it on 3 March and reject the motions praying against the other regulations.

Mr. John Fraser: As a solicitor holding a practising certificate, I declare an interest.
I should make it clear to people who follow our proceedings that due to the lateness of the hour we have been disabled from voting on our prayers against statutory instruments Nos. 338 to 343. Had we been able to do so, we should have voted to oppose those instruments, which introduce the new rules and take into account the resources of a cohabitee—or cohabitees in the case of a bigamist. We should have expressed our indignation at the miserly increase of 6 per cent. in legal aid fees for criminal legal aid work. That is well below the rate of inflation and far less than the profession asked for in its discussions with the Lord Chancellor.
We oppose the Legal Advice and Assistance (Scope) Regulations 1989 because of their new restriction on advice about making wills and property transactions and the likelihood that they are a precursor of further restrictions on green form advice. We further oppose the regulations because of the restrictions described by the Solicitor-General on the growing duty solicitor schemes in county courts. We shall vote against those regulations as a token of our opposition to the other orders, to which we take exception but on which we shall be unable to vote.
The regulations confirm a pattern in the reduction of the number of people who are eligible for legal aid. In 1950, 80 per cent. of the population were eligible, but by 1974 the figure had fallen to about 40 per cent. In 1979, the Lord Chancellor announced that eligibility would be raised to restore it to 80 per cent. of the population, as had obtained when the scheme was first introduced in 1950.
In 1986, when Lord Hailsham was Lord Chancellor, the allowances were down-rated, leading to an extra 25,000 applications for legal aid being withdrawn or refused. That was the first occasion on which there had been a deliberate reduction in eligibility. In 1989, compared with when the scheme first started, only about 50 per cent. of the population are eligible. I used population figures because using the percentage of households as a measure of eligibility for legal aid can be highly misleading, for reasons too complex to go into now. Between 1979 and 1986, about a quarter of the population lost access and


eligibility to legal aid. The policy has been to reverse the open and universal access to justice that the legal aid and advice schemes are intended to implement.
I should be grateful if, in winding up, the Solicitor-General would give us his estimate of the percentage of the adult population—not of households —currently eligible for legal aid, and the extent to which the percentage has fallen since 1986. That question has been asked of the Law Officers and of the Lord Chancellor for the past year and I should be grateful to have the figures tonight. All the signs are that eligibility is continuing to shrink and that the regulations—not dramatically, but to some degree—will continue that process. There is no doubt that the new cohabitation rules on contributions will further reduce eligibility without any compensating increase in the cover of legal aid. They represent not an adjustment between one class of people applying for legal aid and another, but an attempt by the Treasury to claw back an admittedly modest amount of legal aid resources.
The new rules are at best impracticable and at worst oppressive. From my experience of criminal legal aid cases, extra-marital partnerships are common but not easy to define. They are often unstable and a common law partnership may dissolve as a consequence of the alleged offence. The advocate will have to make a judgment not only about the quality of the defence and the way in which it will be necessary to plead and present the evidence, but about the quality of the relationship—often, as a duty solicitor, having to work in a short time spane. He may have to ask questions in a difficult situation about relationships between a man and a woman, rather than getting on with representation of the case.
Those are the reasons why the new rules will be impracticable, but they may also be oppressive. There is no point in having contribution regulations unless one believes in the theory that the common law spouse or partner will contribute the amount that the regulations take into account. In practice, it is a different story. If Janet and John are living together, we cannot assume that Janet—assuming she has an income—will stump up to pay for John's defence when he is on a burglary charge or that she will contribute to the cost of custody proceedings between her common law husband and his previous wife.
The Solicitor-General may say that rules exist at present for contributions between husbands and wives and that the cohabition rules will extend that practice to those in common law relationships. There are three points about that. First, the existing joint contribution rules are already oppressive. One has only to ask any unemployed man who has run out of his entitlement to unemployment benefit after 300 days or so and who finds that he has no entitlement to any other benefit because his wife is working. Many married people regard the cohabitation rule, which applies to the married and the unmarried, as oppressive. People do not welcome it.
Secondly, the trend in our taxation is to favour separate assessment far more than joint assessment. The Solicitor-General is therefore running contrary to what the Chancellor of the Exchequer is doing in relation to income tax. Thirdly, the cohabitee does not possess the property rights that a wife has. The common law wife may be asked to contribute towards her partner's defence, but if he later throws her out of the joint home which is in his name only, she will have no protection. There is not an exact equality

of interest and rights between the common law spouse and the married spouse. That is a reason for not extending the rules to cover common law relationships.
Another important point is that not once in the course of debates on the Legal Aid Bill in 1988 was it suggested that there would be what is now a fairly major change in contribu-tion relations. The common law spouse con tribution principle is being slipped through Parliament after midnight without any possibility of voting on it. That is not just wrong in principle—it is an abuse of the procedures of the House. An unfair and impracticable system is being introduced without proper parliamentary consideration and without any chance for Parliament to reach a decision on that aspect of the regulations.
As for the reduction in green form cover, in practice there has already been a considerable reduction in the availability or use of legal advice and assistance. Between April 1988 and January 1989, one in 13 potential users of the green form scheme dropped out, mainly due to rising housing costs, which are not deductible under the green form scheme—particularly the increases in mortgage repayments engineered by the Chancellor of the Exchequer. Now the scope of the advice scheme is to be restricted in respect of certain aspects of wills and conveyancing.
The green form scheme was described in the Lord Chancellor's Department study as
efficient and most cost-effective
and the restriction will save only a tiny percentage of the cost of legal advice and assistance, at the expense of poor people who exceptionally—already the occasions are fairly rare—require advice on a will or property transaction. The scheme will be complicated by a list of difficult exceptions —for instance, by the confusing proposition that one can get a will under the green form system if one is poor and over 70 but not if one is poor and merely an old-age pensioner. Moreover, the savings from disallowance will be tiny.
Coupled with our views on that is our regret at the ending of duty solicitor schemes in the county courts, which look after people facing eviction. Such people can get representation in the court because a rota system has been introduced by a local law society. The Solicitor-General seems to dismiss such schemes as affording representation to people who do not really need it. I do not regard it as a luxury to provide legal aid to someone faced with losing their home and perhaps with moving into bed-and-breakfast accommodation, especi-ally as the state will be faced with meeting the cost of such accommodation. It may well save money for the local authority and for the family involved and also save the time of the court. It is very much to be regretted that the scheme is to be cut.
The Government's game is not worth the candle ends that it will save. We fear that this is just the first cut, which may lead to cuts in important areas of advice—on immigration or housing generally. If the Solicitor-General can give a solemn assurance that this is the last and only restriction of the scope of the scheme, perhaps he will intervene to say so—if not, we fear that the proposals represent the first step in the erosion of the green form legal aid scheme.
So far, I have discussed the steps which erode the legal aid scheme and restrict access to it. I want now to deal with remuneration for legal aid work, and what is, in my view and in that of most commentators, a wholly inadequate


rise in pay for those engaged in criminal legal aid work on a wholly inadequate base. A year ago, a Law Society survey of criminal legal aid work found that 40 per cent. of solicitors' offices had given up, or were seriously thinking of giving up, criminal legal aid work, and 80 per cent. gave low pay as their reason. A year later a study appeared, the results of which were sensational. Both the method used and the authors of the survey, conducted by Touche Ross, are unimpeachable.
Touche Ross found that the overwhelming number of firms involved in criminal legal aid work do it at a loss. The average profit ratio in the provinces was minus 33 per cent. —the average, of, course, includes those making a profit as well as those making a loss—and in London it was minus 44 per cent. Out of 8,000 firms doing legal aid work, only 70 firms in London were grossing more than £100,000, which is not a great deal in terms of legal aid income, and making a profit, and 450 firms in the provinces were grossing more than £50,000 per year. If all the firms losing money dropped out, only one tenth of those offices now doing criminal legal aid work would be left in business. That would be an enormous reduction in choice and access for criminal legal aid defences.
The orders raise remuneration by 6 per cent., with enhancements for unsocial hours and Saturdays, when evidence shows that last year many firms were making a loss and thinking of giving up legal aid work altogether, inflation is already 7 per cent. and likely to go higher, and salary rises for solicitors generally are charted as running at about 15 per cent. per annum.
The Lord Chancellor is an advocate and a friend of market forces. He believes in the market forces philosophy for the law, but he obviously does not believe, any more than the Government do, that there should be a market rate for the job. The 6 per cent. increase is a miserly rise on a loss-making base and it will drive even more firms to make a loss. In those circumstances, it is an abuse of people with a sense of duty. The same kind of abuse has been inflicted on others who have ethical rules and perform public duties, such as doctors and nurses in the National Health Services and teachers and lecturers in the education service. It means that the quality of representation will be at risk. The more experienced advocates will give up criminal legal aid work and will be replaced by the less experienced. The danger is that there will be a second-class service on second-class pay. Firms will be supported by a cost subsidy from more profitable private work of the sort that the Lord Chancellor is putting into the melting pot with the legal services review.
We all recognise that legal aid work will always be less remunerative than private work, even though the cash flow on legal aid work is much worse than on private work. There will always be some differential between the rates of remuneration for the two kinds of work, but it is grossly unjust that the rates for legal aid work are so far below the market rate as to make it a predominantly loss-making activity for the people involved.
I will adopt some of the arguments of Andrew Thomas —my partner, but also a member of the Legal Aid Practitioners Group—when commenting on the gross discrepancy between the rates of remuneration for those doing legal aid work and those doing private work. He said that remuneration is based on an utterly wrong

principle. We do not pay a judge less money when he is trying a legal aid case than he would be paid trying a private case. We do not pay the policeman who arrests the man who will receive legal aid less money than the policeman who arrests someone who will be privately represented. We do not discriminate in that way.
We do not pay the Lord Chancellor less money when sitting in that part of the Lord Chancellor's Department which deals with legal aid as opposed to that part of the Department which deals with other matters. The Solicitor-General will not take a 50 per cent. cut in his pay to participate in a debate in unsocial hours because we are discussing legal aid rather than some other aspect of legal work such as the law of property legislation that we were discussing in committee 14 hours ago. We do not pay a jury a lower allowance for trying a man who is legally aided as opposed to privately defended.
It is monstrous that a large part of the profession, which now makes heavy losses to deal with criminal aid work, should be penalised because it has a sense of duty and because it is tied to the system. Such people are cross-subsidised from other forms of work. Because of that we shall have a token vote on one of the regulations. I hope that the Solicitor-General will take on board the deep dissatisfaction felt about the restriction and cover of legal aid and about the way in which the professions have been treated.

Mr. David Ashby: I apologise to my hon. and learned Friend for bowling him a googly about the Police and Criminal Evidence Act 1984 and whether representation will still apply. I now know that the answer is yes, but my hon. and learned Friend has told us that, as a result of the regulations, solicitors who go out to police stations to represent people who are detained for extended periods under PACE will receive less remuneration than hitherto. That worries me greatly and, as the House will know, I voted against the Third Reading of the Bill because of that.
I considered that the 96 hours of detention were unreasonable and that they represented an affront to civil liberties. The only saving grace in the Bill was the fact that people who were detained for a long time would have representation. If there is any suggestion that, as a result of the regulations, people will not be represented and that solicitors will be unwilling to go out to the police stations, I urge my hon. and learned Friend to come back to the House with amendments. It is essential that such people should be represented.
When we discussed the Police and Criminal Evidence Bill the Government told us not to worry about the 96 hours of detention. They told us that people kept for extended periods would be looked after and represented by solicitors. If, as a result of the regulations, such people are not to be looked after, that represents a breach of the undertaking then given by the Government. That worries me greatly.
I welcome the safeguards that exist for the disadvantaged regarding wills, but I do not see why legal aid should be extended to people who make wills. I do not see anything wrong in respect of cohabitees. One is dealing with money that goes into the family and if the joint income of cohabitees is above the specified level, I do not


see why legal aid should be extended to them. It may be that the level is too low, but I do not disagree with the principle.
I am disappointed that the regulations have not been extended to cover tribunals. Tribunals are fundamental as they deal with the nitty-gritty of people's lives. What happens to ordinary or disadvantaged people who lose their jobs through unfair dismissal? They go along to a tribunal in the belief that they will receive justice, but they face a wealthy company with an array of solicitors and barristers brought down from London. The ordinary person believes that he will be able to present his case, but he is cross-examined into the ground and overwhelmed. A little bit of legal aid would bring a great deal of justice to such people, and it should be extended to tribunals.
It is important that we do not forget that we do not have an expensive legal system. While I agree that the total amount of legal aid has greatly increased, we do not have an expensive system of justice. Despite what the popular press says, the remuneration of solicitors and barristers in this country is much lower than the profession gets for ordinary work in France, Italy, Germany and the Netherlands. If a solicitor or barrister wants to make money, he or she should go to the continent—it can be done now —where the remuneration is four or five times greater than it is here.
The value of a person being represented in the courts is that it represents an enormous saving in money and time. The cost of cases does not lie in the advocates, as the popular press makes out. The expenditure is to be found in the cost of the buildings. There is a Crown court next door to Harrods; I wonder what that is worth in property terms. Then there are the ushers, police officers, judges, juries and all the back-up staff.
When a person is properly represented, a great deal of money and time is saved because witnesses are interviewed and only relevant witnesses are called. Experienced lawyers call witnesses to deal only with points that are required and not with peripheral matters or waste the time of the court. No matter what certain people, including the popular press, say, there is little wastage of court time. The efficient lawyer saves an enormous amount of time, and time is money.
Trying to get law on the cheap only increases overall costs. I had not heard of the report by Touche Ross and I am sorry, if not surprised, to hear that so many solicitors are saying that they will not do criminal legal aid work. I have solicitor friends, and people who have instructed me, who have said that they will not do such work, but most of them have hitherto been saying not quite that.
They have been saying, "We are making a little loss on the criminal legal aid work. It does not pay much, but we must regard it as swings and roundabouts; we are making a bit on conveyancing and getting some money here and there, so we will do the criminal legal aid work, and overall the practice will be profitable." But now we are faced with a Green Paper and solicitors are finding their conveyancing work under attack. That will reduce the ability of solicitors to subsidise the less profitable areas.
I do not think we will get much change out of the Lord Chancellor's department and have more money going to legal aid. The overall effect of this concerted attack on the profession will be that the poor person who is just outside the legal aid limits will not be able to find a solicitor. Solicitors will not be prepared to do legal aid work if there is nothing else to subsidise it. The whole issue must be

viewed in the round, but I fear that people are not doing that. We are seeing it in bits and pieces. We have the legal aid legislation and the regulations and we have the Green Paper. We are not considering it in the round to try to ensure that solicitors have adequate remuneration for the amount of work that is required.
For those reasons, I put in my reservations. I hope that my hon. and learned Friend will take them into account because it is very important to look at the overall picture.

Mr. Jeff Rooker: I will be extremely brief. Exactly three hours ago, at a quarter to ten, I was responding to a telephone message from a constituent, one of many calls that I was trying to make before the 10 o'clock vote. It happened to be about legal aid. The lady, Mrs. Lane, did not know about the debate that was to take place. She made a few points that are appropriate to raise now, bearing in mind the change in the system.
I will not give all the details. Mrs. Lane, a young widow, told me about her difficulties. Her house was under constant attack. The police would not do anything; they told her that she needed an injunction. She went to a local solicitor and got an injunction. Her total income—not disposable income—is only £88 per week, made up of the widowed mother's allowance of £51, child benefit of £7 and part-time earnings of £30. She has never received supplementary benefit or any other social security benefit.
Mrs. Lane got an injunction. The hassle did not stop. Last September, without warning, up popped a bill for £360. It goes without saying that she has no savings. She got in touch with the legal aid authorities in Preston or London; I am not sure which it was. There was no answer. Next, she had bailiffs at the door because she had not paid her bill. She told them to go away.
Checks were made and it appeared that the authorities had forgotten that she was a single parent and all kinds of things. She has still ended up with a bill for nearly £300. I did not go into all the details because there was not time, but I will provide the Solicitor-General with further details within a few days. I cannot understand how a young widow, who has sought help from the police and who is told to get an injunction, should end up with such a bill when she is struggling along on a low income, without any means-tested benefit. She has been told that she will have to pay off the bill in less than a year. The bill was miscalculated originally, After complaining, she heard nothing until the legal aid authorities sent the bailiffs round.
That is an example of the disgraceful administration of the legal aid system. I do not want to give any information about her solicitors. They do not seem to have given her the best advice about the circumstances that she would get into. If it helps the Minister, the lady's name is Mrs. Lane and the reference number is 1347118–6. I am told that the legal aid office in Preston knows all about the case.
Someone should ensure that the legal aid authorities, even under the new system, do not send the bailiffs round to constituents who have legitimately questioned bills, before those constituents have received answers. Whoever is responsible for it, that is disgraceful administration. No doubt the Solicitor-General will be as appalled as I am. I hope that Mrs. Lane will have some respite and that her bill will be checked properly.
Taking into account Mrs. Lane's total income and the bill she has to pay, it is outrageous, even considering the figures contained in the regulations, that she has been put in such a position as a result of going to court to defend herself and her daughter because they were under attack. That is the only point I want to make. I hope that the system under the regulations will be better than the system under which my constituent suffered. I hope too that something can be done about her case.

Mr. Bob Cryer: I shall be brief. I shall not go into the merits of the regulations, save to say that statutory instrument 1989, No. 340, and statutory instrument 1989, No. 344, carry the rubric that the Select Committee on Statutory Instruments has not yet completed its consideration of them. I protest at the constitutional outrage that has been visited upon Parliament by the Government. These instruments were sent to the Committee, which, I remind hon. Members, has a duty to report to the House if there are any technical faults, if a Minister is abusing his or her power, if there is a fault in drafting, or if an instrument is ultra vires.
These two instruments and others in respect of which faults were not found—there is no qualification on the Order Paper—were sent on Thursday and Friday of last week. The Committee meets every Tuesday at 4.15 pm, so it was quite clear to the Government that by the time we received the instruments we would have only one day in which to consider them before reporting to the House. In respect of the two instruments concerned, we have asked the Department for memoranda. That is what we have to do in order to report an instrument to the House. We have to give the Department an opportunity to present its answer to our queries, yet, by so doing, we lose the opportunity to present a report to the House, because the debate is being held tonight.
There is worse to come. The instruments come into force on 1 April. In the case of statutory instrument No. 344, the fault about which we are particularly concerned involves the calculation of the means of a person being considered for legal aid. Practitioners will be expected to operate this instrument from 1 April, and a parliamentary Committee, whose membership is in accordance with party strengths in the House, is being denied the opportunity to report effectively on it. The Committee is being thwarted in the task that the House has given to it. It really is completely and utterly outrageous.
There is another point. The Committee arranged to meet the Leader of the House on Tuesday to discuss this very problem. I am talking not just about myself, but about Conservative Members also; they accompanied me to see the Leader of the House. We expressed very strong reservations. We do not wish to see our work set at naught by having instruments debated on such a date and at such a time that the Committee simply cannot do its job. That is what is happening tonight, and it is an abuse of Government powers to trample over a Select Committee of the House in such a way. We have been denied the opportunity to report to the House the defects of an instrument.
I should point out to the Minister that the defects in respect of these two instruments were not raised by

members of the Committee but were brought to our attention by counsel to the Committee. If the Minister is thinking of arguing that somebody on the Committee is playing politics, let him know that that would be quite erroneous. As he knows, our adviser is the counsel to the Speaker, and he advises us purely on technicalities. In any case, the Committee does not deal with the merits of instruments.
I am sure that I am registering a protest for all members of the Committee, Conservative and Labour alike. It is an abuse of our procedures to bring regulations forward without giving the Committee an opportunity to report, and to do so in such a way that the prayers cannot be dealt with because they were taken after 11.30 pm. The Government are crowding parliamentary time too much. They are getting too much legislation through, and democracy is being trampled on.

Mr. Keith Vaz: We must look at the draft regulations in the context of the Government's policies on legal aid and the way in which the profession now views the Government. The profession has lost confidence in the way in which the Government have been operating the legal aid scheme, as have the consumers.
The past 10 years have seen a multiplicity of legislation that has had a great effect on social and welfare law. Before I was elected to the House, I served as a solicitor in a law centre in Leicester. I hoped that, once elected, I would cease to act as a legal adviser to my constituents. Although I hold a practising certificate and I declare an interest for that, I do not practise as a solicitor.
All of us who represent inner-city seats know the level of case work at our surgeries that has been generated by the changes in social security law, housing law and immigration law—in all aspects of social welfare law. What we needed from the Government in the regulations was an extension of legal aid and greater provision for those who seek justice through our legal aid system.
However, what we have is a situation in which consumers cannot afford to go to private solicitors. They cannot afford legal assistance, because, as my hon. Friend the Member for Norwood (Mr. Fraser) said, the number of people eligible for legal aid has diminished greatly over the past decade. Many people cannot afford to go to solicitors or to pay for the cost of private legal services. Therefore, they have to go to their Members of Parliament, they have to seek advice from those who are not qualified to give advice, or they simply cannot obtain justice.
I hold no brief for solicitors. I have yet to meet a solicitor who is on the dole or who is starving because he or she cannot make a living. I know many solicitors and barristers who do very well out of the legal aid system and I know many more who do very well out of our private legal system. However, if solicitors are not being properly remunerated for their legal aid work—a survey conducted by the Law Society shows that many solicitors are either giving up legal aid work or are about to give it up because they are not properly remunerated—it means that people are going without proper legal advice, and that is a problem.
In a city such as Leicester different forms of agencies provide legal advice and assistance, and thriving and flourishing private firms of solicitors are essential for


providing that network of legal services. We have two law centres in Leicester—one of which has been in crisis over the past two years, although I hope that at 8 o'clock this evening it will form itself again into a properly functioning law centre. We also have a citizens advice bureau which gives advice and assistance, and we have a private sector. Each of those arms of the network of legal service is essential for my constituents to get proper advice and assistance.
I conducted my own survey of local solicitors firms when I served on the Committee on the Legal Aid Act 1988, sitting opposite the Solicitor-General. I asked them whether they were satisfied with the present administration of the legal aid system, and not a single one replied that it was satisfied. They all felt that they would have to choose between continuing in that work and providing advice and assistance, and doing company and commercial work and conveyancing.
I cannot understand why, having accepted that there are special cases of people who should get assistance under the green form schemes for wills and conveyancing the Solicitor-General does not go that little bit further and allow all the other cases to be admitted. It is essential that if someone is 69, and therefore does not qualify for the exemptions set out by the Solicitor-General, he or she should be able to obtain proper advice on how to prepare his or her will. I support the arguments put forward by my hon. Friend the Member for Norwood and others about the duty solicitors scheme. It is essential that those who go to the county court—tenants facing possible evictions or possession orders from local authorities and others—should be able to obtain proper advice, assistance and representation.
There is no evidence that the system is being abused by solicitors. We need a network of legal services throughout the country. I should prefer it if legal aid was not operated on the basis of a business, but as it is in America, which has a public defender scheme in which solicitors are paid a fixed salary through a network of law centres. I accept that, under this Government, who have cut the amount of resources available, we shall not obtain a system of that kind.
I support what the hon. Member for Leicestershire, North-West (Mr. Ashby) said about the need to extend legal aid. So much could have been achieved by the draft regulations. The Solicitor-General could have presented proposals for the extension of legal aid to industrial tribunals, to provide proper assistance for people. Under the Employment Bill currently going through the House, people will be required to put down deposits to guarantee their case before they can go before industrial tribunals. These proposals are further attempts to prevent people from exercising their rights.
When the Legal Aid Act was in Committee, I asked the Solicitor-General whether he felt that justice was cost-effective. He told me—this seemed strange coming from a lawyer, and Solicitor-General—that it should be. That is where we part company. Resources should be made available for people to exercise their rights and obtain proper justice. The Solicitor-General should not kow-tow to the views of the Treasury and the Chancellor of the Exchequer and cut funds which are necessary for people to obtain justice and proper legal services.

Mr. Terry Davis: I shall join my hon. Friends in voting against these regulations for the reasons explained by my hon. Friend the Member for Norwood (Mr. Fraser) and my other hon. Friends who have participated in the debate. I shall do so particularly because of the Government's failure to extend legal aid to representation at tribunals, which leaves a serious gap in legal aid provision. In Birmingham, that gap is to some extent filled by the establishment of a number of organizations—notably the Birmingham tribunal unit and the legal unit of the citizens advice bureau. However. this means that the gap is being filled by bodies which are financed largely by city council grants, so Birmingham's ratepayers are paying for people to be legally represented who would not otherwise be represented. Tribunals may deal with matters which are extremely important for the individuals involved.
The Member for Leicestershire, North-West (Mr. Ashby) referred to industrial tribunals, but there are other extremely important tribunals which deal with social security legislation and people's rights to tenancies, mobility allowance and income support. In the past, there have been applications for single payments and appeals when they were refused. In that range of social security benefits it is extremely important that claimants should have the opportunity to be represented by people who are more articulate, skilled and experienced in those complicated regulations.
I wish to draw the attention of the House and particularly of the Solicitor-General to another omission from the regulations. In recent months, a number of constituents have complained to me about having their legal aid certificates discharged against their will These people do not consider that they have exhausted the procedure for taking legal proceedings against doctors or neighbours. Such matters can be extremely important in peoples' lives. A constituent of mine, with my assistance, went to appeal against a discharge of her legal aid certificate in a complicated case involving alleged negligence by doctors. After my representations to legal aid head office, a second hearing was arranged because it was agreed that the original hearing of her appeal had not been satisfactorily considered and the procedures had not been followed in such a way as to satisfy the regulations.
I was disturbed to learn that a person who goes to the area committee to appeal against a discharge by the area director is not given the report known as the case note, which is prepared by the staff in the legal aid office. That is incredible. I know of no other example of a person going to court and not being shown the evidence against him —or the evidence of the other side in a civil action. To have to explain why one does not think one's legal aid certificate should be discharged without knowing the reasons for its discharge is extraordinary. I know of no tribunal that would consider a person's appeal against the refusal of a social security benefit without showing the person an explanatory statement. Many of my constituents have appealed against decisions on immigration, and they are always given an explanatory statement prepared by the entry clearance officer.
It is not enough to provide. as the regulations do, for a person to be given the grounds for the discharge of a legal aid certificate. We are used to seeing two or three-line grounds for refusal of entry clearance or of a social


security benefit. It is important to understand the reasons why the entry clearance officer, or the adjudication officer in the social security system, has come to his or her decision to refuse the person something. Yet the regulations do not provide for people to be given explanatory statements. I imagine that the Solicitor-General, like me, did not know that that was necessary before, but the principles of natural justice require that a person be given the reasons for a decision.
My constituent who wished to appeal against the discharge of a legal aid certificate went to the area committee and explained why she thought that her legal aid certificate should be reinstated, but she was not given any information about the reasons for the decision by the legal aid staff—reasons which were given in writing to the area committee. She was expected to argue her case against reasons that she had not been told. That is amazing.
That decision was not made by the legal aid area director, who sheltered behind a decision which she said had been made by the Legal Aid Committee in London —that people should not be given reasons for a decision to discharge a legal aid certificate. That is grossly unfair. Hon. Members on both sides of the House would consider it so. I hope that the Solicitor-General does, too, and that he will join me in making strong representations to the new Legal Aid Board which will replace the present Legal Aid Committee to ensure that this bad practice is changed immediately.

Mr. Gerald Bermingham: I declare an interest—past, present, and probably future: I have been both barrister and solicitor.
I read the regulations with growing horror. I ran a large practice in the north of England—it included a large legal aid element—and experience has taught me that profitability in legal aid has slowly decreased over the years. That presents a real danger. Not only are the numbers of people who are eligible for legal aid falling, but the incentive to solicitors' firms to undertake legal aid work has decreased.
It is all very well for hon. Members to say that there are no poor solicitors. A solicitor practising in a rural area is already under threat from the reform of the conveyancing rules. At the same time, according to Law Society surveys, legal aid work is clearly unremunerative. Therefore, the solicitor has two choices: either to forsake work or to move to a large city or a company in that city. That means that practices are moving from the rural and semi-suburban areas whether or not they depend on legal aid work. The right to representation is denied to people in those areas.
When we introduced the legal aid system years ago I thought that the objective was to increase people's rights to representation in the courts. Over the past 20 years I have seen that the law is slowly concentrating in the hands of those who can afford to pay for it. As was said earlier, a company is represented at an industrial tribunal with all its might, ammunition and armaments. The applicant may sometimes be assisted by his trade union official, but very often he is on his own. What price justice?
The Law Society recently produced a document which shows that the representation in county courts for the

unassisted plaintiff provided by solicitors on a voluntary basis, is diminishing. The amount of remuneration available makes that representation uneconomical. Legal aid is being withdrawn in that area.
In the county courts and before registrars, the unrepresented defendant, very often the plaintiff in person, appears without the necessary skills—[Interruption.] I hope that the Government Whip who has just entered the Chamber will concentrate on this debate rather than on his social life. Manners are precious, even in this place.
Justice is being denied. The plaintiff in the circumstances that I have just described does not know all the rules or regulations. He does not know when the affidavit must be filed and he is unaware of the procedural minefield through which most plaintiffs must proceed if they wish to succeed. Very often in possession cases a plaintiff will face the might and main of a major company landlord who will be armed with counsel, solicitor and all the good advice that they can give.
Matters are currently striking at the very heart of our system of justice in respect of the criminal law. The first of these is the serious matter of the provision of expert witnesses at Crown court trials. I am aware of occasions when I and my colleagues at the Bar have advised that expert evidence is required. You have no idea, Mr. Deputy Speaker, of the difficulty in obtaining permission to call expert witnesses on behalf of the defence. Those witnesses may be able to give evidence on handwriting or fingerprints or they may be engineering witnesses in car-ringing cases. However, the defence is told that those witnesses are not allowed. Justice is not being served when that happens. We do not advise that experts are necessary in those cases if they are not, because counsel who so advise run the professional risk of being criticised. No one would undertake that risk lightly. However, legal aid authorities are reluctant to allow such witnesses and the usual excuse is the cost involved.
Justice is again put at risk by the meanness or the cash limits being applied to legal aid work. It is easy for lawyers to plead their own cause. We are often the subject of fun and the butt of humour because we appear to be asking for more, like Oliver Twist. However, the issues that I raise tonight have nothing to do with the remuneration of lawyers, because there will always be lawyers who are prepared to do legal aid work. Lawyers have a sense of morality and a commitment to justice.
The point I make is that because of the meanness of the legal aid authority and the denial of assistance to the plaintiff or to the person in the dock, his or her case or cause—and sometimes his or her liberty—is put at risk. That is because somewhere there is a bureaucrat who does not understand the system but who is the arbitrary judge of whether expert advice or help should be made available to the person whose liberty may be at risk.
The regulations do nothing to serve justice. They will probably diminish the number of lawyers who are prepared to undertake legal aid work. They will probably make justice less accessible to many people. The Solicitor-General need not reply to me tonight, but perhaps he will at some stage explain what tables 1 and 2 on page 20 of the regulations mean. I suspect that they constitute another attempt to cut the income of those preparing to serve justice by undertaking legal aid work.

The Solicitor-General: I shall endeavour to answer briefly the questions raised by the hon. Member for Norwood (Mr. Fraser) and by other hon. Members. The first question of the hon. Member for Norwood concerned eligibility, which quickly became linked with other points on remuneration. As those hon. Members who participated in debates on the Legal Aid Bill will recall, it is extremely difficult accurately to answer what proportion of the population—let alone of households—is eligible for legal aid. It depends very much on the circumstances of the individual household. It may not be eligible as a whole, but if the family breaks up, one of the spouses may become so.
Legal aid is reaching more people than ever before. Since 1979–80, the number of criminal legal aid orders granted has increased by 40 per cent. to nearly 600,000. Over the same 10-year period, the number of bills paid for those receiving advice and assistance under the green form scheme has increased also by about 40 per cent. and now stands at more than 1 million. The number of new legal aid certificates issued has increased by about 30 per cent. to 250,000. In addition, assistance by way of representation —ABWOR—was introduced and has been provided in about 60,000 cases.
The Government have also made provision for duty solicitor schemes at magistrates courts and for advice and assistance at police stations. In the 10 years since 1979, overall expenditure on legal aid has increased from about £100 million in 1979–80 to nearly £550 million in 1989–90, which is an increase way ahead of inflation. Of course it relates to many more people receiving legal aid, but that is what legal aid is about.
As to remuneration, there have been detailed discussions between the Lord Chancellor's Department and the Law Society. Mention has been made in the debate of the Touche Ross report, which was well designed to inform debate on what levels of remuneration ought to be. It is true that, according to the tests applied, legal aid remuneration does not appear to be profitable in the case of a small firm undertaking a low volume of such work.
The difficulty is that, at present, the same levels of remuneration are payable regardless of whether a practice undertakes one or two cases over a lengthy period, or a large number of cases, week in and week out. However, the figures—which have been the subject of much discussion between the Lord Chancellor's Department and the Law Society—show that, provided a practice undertakes a substantial volume of legal aid work, it can be very profitable. The hon. Member for St. Helens, South (Mr. Bermingham) will understand that very well.

Mr. Bermingham: Does the Solicitor-General accept that the cost of running a solicitors' practice is between £40 and £60 an hour in an urban area and probably between £30 and £40 an hour in a rural area? I may be going back a few years as I have not checked recently. If the Solicitor-General would only look at the legal aid rates, he would see that the amount paid per hour is less than the cost of running a practice, so it cannot be profitable.

The Solicitor-General: I did not intend to incense the hon. Gentleman. I wanted to draw it to the attention of the House that, if a firm does a substantial amount of legal aid work, it can be very profitable. The problem is not that the figures are wrong, but to find a fair way to deal with small firms in rural areas, just as one looks for a fair way to deal

with medical practitioners with scattered rural practices. The Lord Chancellor's Department intends to study the matter carefully. However, the Touche Ross report demonstrates that legal aid can be substantially profitable if a firm does sufficient work.
My hon. Friend the Member for Leicester, North-West (Mr. Ashby), the hon. Member for Birmingham, Hodge Hill (Mr. Davis) and other hon. Members called for legal aid for tribunals. The position is not static and we discussed the matter in relation to the Legal Aid Bill. The hon. Member for Leicester, East (Mr. Vaz) will remember that research is in course, particularly into legal aid for industrial tribunals, social security appeal tribunals, immigration adjudicators and mental health review tribunals. That research team will report shortly.

Mr. Vaz: Will the Solicitor-General give way on that point?

The Solicitor-General: No. I must press on, as I have to deal with a number of points.
Green form assistance is already available. The hon. Member for Hodge Hill raised a particular case in which there appeared to be some lack of natural justice in an appeal to an area committee. The general reasons why legal aid has been refused are given, although individual committees may have different practices; if the hon. Gentleman writes to me, I shall look into the case he raised.
The hon. Member for Birmingham, Perry Barr (Mr. Rooker) raised another detailed case. If he sends me further details, I shall look into the case and do my best to answer him.
An apology may be owed to the hon. Member for Bradford, South (Mr. Cryer), as the regulations have had to be brought before the House in some hurry. He recognised that we had to bring the measures forward because some citizens might lose because the regulations must be in effect by 1 April. To put the matter into some perspective, I am told that the instruments were laid on 8 March and drafts of them were supplied in advance to the officials of his Committee in January. If there is fault on our part, I shall look into it, and if an apology is owed I give it now. We certainly do not wish to be disrespectful to his Committee, but I hope that the points that I have made and our attempts to do things in advance have at least eased the position.
I have covered most of the points raised in the debate. We are dealing with a serious matter. I emphasise the very large increase in the provision of legal aid. The object of legal aid is to provide those who cannot afford it with sufficient means to litigate when litigation is necessary for circumstances beyond their control or where they should reasonably have support. The objective of the regulations is to put the Legal Aid Act into effect, and I commend them to the House.

Question put:—

The House divided: Ayes 73, Noes 32.

Division No. 134]
[1.24 am


AYES


Amess, David
Boswell, Tim


Amos, Alan
Bowis, John


Arbuthnot, James
Brazier, Julian


Arnold, Jacques (Gravesham)
Bright, Graham


Ashby, David
Browne, John (Winchester)


Batiste, Spencer
Carrington, Matthew


Bellingham, Henry
Chapman, Sydney


Bennett, Nicholas (Pembroke)
Coombs, Anthony (Wyre F'rest)






Couchman, James
Knapman, Roger


Cran, James
Lang, Ian


Currie, Mrs Edwina
Lightbown, David


Davis, David (Boothferry)
Lyell, Sir Nicholas


Dorrell, Stephen
Maclean, David


Dover, Den
Mitchell, Andrew (Gedling)


Durant, Tony
Neubert, Michael


Fallon, Michael
Nicholls, Patrick


Favell, Tony
Nicholson, Emma (Devon West)


Fenner, Dame Peggy
Norris, Steve


Field, Barry (Isle of Wight)
Paice, James


Forth, Eric
Porter, David (Waveney)


Garel-Jones, Tristan
Raffan, Keith


Greenway, John (Ryedale)
Ryder, Richard


Gregory, Conal
Sackville, Hon Tom


Griffiths, Peter (Portsmouth N)
Shaw, Sir Michael (Scarb')


Ground, Patrick
Spicer, Sir Jim (Dorset W)


Hague, William
Stevens, Lewis


Hanley, Jeremy
Stradling Thomas, Sir John


Hargreaves, Ken (Hyndburn)
Taylor, Ian (Esher)


Harris, David
Thompson, Patrick (Norwich N)


Hayward, Robert
Thorne, Neil


Heathcoat-Amory, David
Thurnham, Peter


Hind, Kenneth
Twinn, Dr Ian


Howarth, Alan (Strat'd-on-A)
Vaughan, Sir Gerard


Howarth, G. (Cannock &amp; B'wd)
Waddington, Rt Hon David


Hunt, David (Wirral W)
Widdecombe, Ann


Hunter, Andrew
Wood, Timothy


Irvine, Michael



Jack, Michael
Tellers for the Ayes:


Janman, Tim
Mr. Kenneth Carlisle and


Jessel, Toby
Mr. John M. Taylor.


King, Roger (B'ham N'thfield)





NOES


Abbott, Ms Diane
Cunliffe, Lawrence


Barnes, Harry (Derbyshire NE)
Davis, Terry (B'ham Hodge H'I)


Battle, John
Foster, Derek


Bermingham, Gerald
Fraser, John


Bruce, Malcolm (Gordon)
Godman, Dr Norman A.


Campbell, Ron (Blyth Valley)
Golding, Mrs Llin


Cryer, Bob
Gordon, Mildred


Cummings, John
Griffiths, Win (Bridgend)





Hughes, John (Coventry NE)
Vaz, Keith


Livsey, Richard
Wall, Pat


Nellist, Dave
Walley, Joan


Pike. Peter L.
Welsh, Andrew (Angus E)


Quin, Ms Joyce
Welsh, Michael (Doncaster N)


Rooker, Jeff
Wise, Mrs Audrey


Salmond, Alex



Skinner, Dennis
Tellers for the Noes:


Smith, Andrew (Oxford E)
Mr. Frank Haynes and


Spearing, Nigel
Mr. Allen McKay.

Question accordingly agreed to.

Resolved,
That the draft Legal Advice and Assistance (Scope) Regulations 1989, which were laid before this House on 3rd March, be approved.

Resolved,
That the draft Civil Legal Aid (Matrimonial Proceedings) Regulations 1989, which were laid before this House on 3rd March, be approved.—[Mr. Lightbown.]

Resolved,
That the draft Legal Aid (Functions) Order 1989, which was laid before this House on 3rd March, be approved.—[Mr. Lightbown.]

STATUTORY INSTRUMENTS, &c

Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &amp;c.)

VALUE ADDED TAX

That the Value Added Tax (Education) Order 1989 (S.I., 1989, No. 267), dated 27th February 1989, a copy of which was laid before this House on 1st March, be approved.

COAL INDUSTRY

That the draft Coal Industry (Restructuring Grants) Order 1989, which was laid before this House on 24th February, be approved.—[Mr. Lightbown.]

Question agreed to.

Water Rates (Grampian Region)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lightbown.]

Mr. Malcolm Bruce: I am glad to have the opportunity to raise the issue of metered water rates. I shall refer specifically to Grampian region, although it is an issue throughout Scotland. Before I ask the Minister a number of questions, I should like to put the problem into perspective.
Grampian regional council has always had a very positive attitude towards business and industry. The present Social and Liberal Democrat-led administration has continued to develop what I freely acknowledge to be the previous Conservative administration's pro-business attitude. It has adopted a positive approach to promoting the attractive business environment and enterprising character of the north east of Scotland through its small business enterprise scheme, which dispenses more than £1 million per year in grants and loans. The Grampian Initiative, chaired by Councillor Nicol Stephen has continued this promotional stance with all-party support. Non-domestic rates for Grampian remain the lowest in Scotland. The general climate is positive and pro-business and the council is anxious to ensure that opportunities are encouraged and that businesses flourish in the area.
The rapid expansion of the oil industry in Grampian during the 1970s led to the progressive withdrawal of assisted area status, and traditional industries faced rising local costs as a result of pressure while capital assistance was being removed. In the circumstances, the council was forced to invest in substantial new schemes to provide for the extra demands for water services. The Minister may recall that a proposal to create a large stored water catchment area in the Cabrach in the 1960s was resisted by local landowners. It is a matter of continuing regret that that did not go ahead.
Water in Grampian continues to be drawn from the region's rivers and a high proportion of capital charges are of recent origin, with a consequently high debt service charge—£9·89 million for 1989–90. The region also faces costs well above average for electricity for pumping water out of the rivers in the absence of adequate storage facilities. The council took full advantage of the provision under the Water (Scotland) Act 1980 to provide extra support for the 7,000 metered water users out of the general rate. That legislation was of particular help to the region, given the background that I have described.
The very positive support allowed under the 1980 Act is irreversibly compromised, however, by the requirement of schedule 5, paragraph 4 of the Abolition of Domestic Rates Etc. (Scotland) Act 1987, which effectively removes the option. The Act says:
A local authority may apportion their estimated expenditure under paragraph 2 above on whatever basis they consider appropriate, but"—
and this is a very big but—
they shall ensure that the apportionment is not such as to show undue preference to, or discriminate unduly against, any class or classes of person liable to pay—

(a) the direct charges;
(b) the community water charges; or
(c) the non-domestic water rate, respectively."

Properly, and quite understandably, Grampian region-al council consulted its legal advisers and COSLA to

determine the range of discretion open to it in the light of that change in the law. The council had to ensure that the region's water costs—estimated at £20,062,000 for 1989–90 —were fully covered by water charges and fairly allocated among the three classes of user. Total consumption is estimated at 58,807,000 cu m. Some 51 per cent. of that is domestic, 40·7 per cent. is metered and 8·3 per cent. is for other non-domestic users.
COSLA's proposals for how the allocation should be applied were based, as I am sure the Minister will acknowledge, on a technical appraisal of the application of the law and can in no way be interpreted as a political comment. The Scottish Development Department was represented on the working party so presumably it accepted the objective nature of the formula that COSLA worked out. The council did not apply the formula without modification for local circumstances. It did not slavishly follow COSLA's guidelines. It was agreed, for example, that only 80 per cent. of leakages should be allocated across all classes of water, because it was known that 20 per cent. of leaks come from consumers' private pipework. That had a mitigating effect on the metered water charge, but was nevertheless a small proportion of the total amount.
The council concluded that the law
very severely restricts the Council's ability to assist metered consumers to any material extent.
The council maintains that lop of the total increase of 22·5p per cubic metre—an increase from 20·5p to 43p—results directly from the abolition of the public water rate, and 10p from the abolition of the provision in the 1980 Act allowing for cross-subsidy from the domestic rate. That leaves only 2·5p to be attributed to the rising cost of providing water, so it is a marginal percentage. In other words, the overwhelming majority of the increase is outside the council's discretion. If it showed more than due preference to any class of user, it could face legal action from other classes of user who felt that they had been discriminated against.
I am sure that the Minister recognises from the representations that he has received from me and from others that the increase has caused widespread concern among metered water users who are facing dramatic and abrupt cost increases. The increases range from several hundred pounds at the bottom—that is still a significant amount because we are talking about small farms and businesses, for which that kind of increase in cost is still significant—to more than £100,000 for the largest users. That is a substantial extra cost to absorb on the bottom line.
The situation is especially unfortunate for the food industry, which is of established and growing importance for Grampian. The region is renowned for its quality products from land and sea, and adding value to these is of major importance to the future direction of the local economy. That is why the region is actively promoting food parks at Inverurie in my constituency and also in Forres in Moray. Such substantial increases in water charges as in the council's judgment are required by law are neither helpful nor in any way what the region wishes to impose. Barry Evans of Buchan Meat is chairman of the Grampian Initiative food task force which is spending £75,000 marketing the region's food processing potential. Mr. Evans has expressed considerable concern at the impact of the increases on promotional activities.
On the basis of my meetings with the Minister and our exchange of letters, I must say that if the Minister believes that there is scope within the law for a substantially different apportionment of charges between metered water users and others than the legal advisers to Grampian and COSLA believe, it seems only reasonable that his officials should at least agree to have a private meeting with Grampian officials to discuss the interpretation. That view is strongly pressed by councillors and users.
Although the right hon. Member for Kincardine and Deeside (Mr. Buchanan-Smith) is not present, he supports my request to the Minister to encourage such a meeting to take place. There is a fundamental difference of view between his interpretation and that of his legal advisers and that of the legal advisers to the council. It does not help to make political statements when the issue at stake is the legal advice given to respective bodies.

Mr. Alex Salmond: The hon. Gentleman may be aware that my hon. Friend the Member for Moray (Mrs. Ewing) and I are organising a meeting of the many affected businesses in our constituencies at the end of the month in Portsoy. We have sent an invitation for the Minister or one of his colleagues to come to the meeting to explain the Scottish Office case. Would it not be extraordinarily disappointing if, having already refused a meeting with Grampian regional council, representatives of the Scottish Office also refused to attend that meeting?

Mr. Bruce: I agree with the hon. Gentleman that it is not acceptable for the Minister to refuse to meet the council officials and representatives or the users at either a public meeting at Portsoy or at a private meeting. It is essential that the matter is cleared up at a meeting, and I understand why the hon. Gentleman and his colleague are anxious to learn what is happening from a Government representative.
The Abolition of Domestic Rates Etc. (Scotland) Act 1987 is the source of the change and I believe that the Minister steered it through the House. Therefore, he knows the intentions behind that Act and the expected outturn. The impact is not exclusively confined to Grampian, but it is the area worst effected. That observation is borne out by the fact that metered water rates throughout Scotland have increased sharply, Grampian's increase of 110 per cent. is the largest because, ironically, it has done much to help water users in the past and, for physical reasons, it has the highest water costs in Scotland.
Increases elsewhere include 72 per cent. in Highland, 69 per cent. in Strathclyde, 64 per cent. in Dumfries and Galloway and 53 per cent. in Lothian. Even the lowest increases of 18 per cent. in Fife, 24 per cent. in Central and 27 per cent. in Borders are well above inflation. Those increases are mostly due to the fact that those councils had not taken full account of the previous legislation.
The impact is so serious that the Government should be prepared to provide some form of transitional funding, especially as the requirement is that the apportionment of sewerage charges should follow suit—over a longer period —and charges for that and water may also be subjected to VAT.
The Minister has said that he has no power to intervene, but I question that. He could make allocation under revenue support grant orders to provide transitional funding. I remind the Minister that the Government found time for primary legislation to provide for transitional funding to compensate people for the effects of rating revaluation and this is an exact parallel. It is causing considerable hardship and affecting people who would support the Government.
Time could quickly and easily be made in the parliamentary programme. I am sure that the hon. Members for Banff and Buchan (Mr. Salmond) and for Angus, East (Mr. Welsh) would agree that there is one Bill which we could do without. If that Bill went we would have the legislative space and time needed to deal with this problem.
The crunch question is why the change in the law was introduced. Apparently the main objective is to put water charges on a separate footing from other local authority accounts. Inevitably that appears as the first step towards the privatisation of Scotland's water services. The fact that the Government inserted a major new Scottish section into the Water Bill yesterday reinforces the case to suggest that paving measures for privatisation are being effected.
The increases are only the beginning. Once privatisa-tion gathers momentum, all water users will face sustained and rising costs and, of course, all water supplies will eventually be metered.
The Minister's refusal so far to meet Grampian regional council or representatives of the 7,000 metered water users shows that the Government are unwilling to admit responsibility for their own laws. Grampian regional council's legal advice is that it had no choice but to impose the increases so as to conform with the law. The council has demonstrated, as my speech has shown, that it is pro-business, has always supported business, is anxious to promote the food industry and would like help it to adjust to the change that has been imposed.
If the Minister believes that his Department has a judgment different from Grampian region about what can be done, the least I ask him to do is to agree to a meeting —even a private meeting—at which officials can get together to discuss the matter so tht if we cannot reduce the charges this year, we can ensure that reductions are possible in the following years. Otherwise the Minister will be putting businesses and jobs unnecessarily at risk. I challenge him to explain how the bulk of the increase is not due to the law introduced by the Government.

The Minister of State, Scottish Office (Mr. Ian Lang): The hon. Member for Gordon (Mr. Bruce) has afforded the House a useful opportunity to debate the new arrangements for water rates, especially metered water rates, in Grampian region.
At present, under the Water (Scotland) Act 1980, water supplied to the non-domestic sector is paid for in three ways. First non-domestic consumers with an unmetered supply pay the domestic water rate levied on a proportion, usually one half, of the net annual value of the premises concerned. Secondly, metered water users pay a charge according to the volume of water consumed. Thirdly, in addition, in Borders, Dumfries and Galloway, Grampian, Highland and Strathclyde regional councils and Orkney and Western Isles island councils, all ratepayers, domestic


and non-domestic, pay, through their regional or general rate, a public water rate which can meet up to one third of the net expenditure on water supply. Water consumed in the domestic sector is paid for by the domestic water rate and, in those councils where it is applicable, by the public water rate.
The existing system had to change. People did not know how much it cost to provide their water supply, authorities could charge part of the cost to the general account and there were no provisions in the legislation that required the charges to be fair at all. It is right that everyone should know the true cost of services they receive or commodities they use. Water is a valuable resource and while it may be delivered from the heavens free, it has to be collected, stored, treated and distributed to individual properties. In many places it has to be pumped as well, and this is particularly true of Grampian region.

Mr. Bruce: In the light of what the Minister just said, may I ask him to explain why the Government introduced the 1980 Act, which did exactly the opposite and allowed cross-subsidisation from the general rate? What happened in those eight years that made the Government decide that they wanted to change the system?

Mr. Lang: The hon. Gentleman is inviting me to stray down avenues which would prevent me from replying to his concerns about metered water charges. I have given him the reason why we believe that a change is now desirable.
Under the present system, water is paid for on the basis of rateable value, quantity used or a combination of both. The new arrangements for paying for water are contained in the Abolition of Domestic Rates Etc. (Scotland) Act 1987 and the provisions in the Act have been known since 1986. Specifically, the Act requires that in apportioning costs between community water charges, non-domestic water rates and metered charges, water authorities shall not show undue preference to, or discriminate unduly against, any class of consumer. It also abolishes the public water rate.
The Act does not specify how each authority should make its even-handed apportionment of costs. That is up to them, but almost all have chosen to distribute the costs in proportion to the volume used by each class of consumer. For the first time, authorities had to establish how much of their expenditure should be allocated to each sector. Their apportionments have shown that metered consumers had in the past not borne their full share of the cost of supply. A significant adjustment in metered rates was called for in order not to discriminate against other classes of consumer.
However, the increase in metered rates does not present the whole picture. Offsetting savings from the abolition of the public water rate reduce the impact significantly. Those with high rateable values and low consumptions will pay less than before. For example, in Grampian a business with a rateable value of £10,000 could use up to 500 cu m of water per year and still pay less under the new arrangements. A company with a rateable value of £1 million could use up to 50,000 cu m and still be better off.
Within the fairness provisions, there is, however, scope for authorities to exercise some discretion without making any undue discrimination. In fact, many authorities have made adjustments to the basic volume apportionments to reduce the impact on metered consumers. Grampian, in

fact, has modified the straight "volume used" criteria recommended by COSLA and has reduced its metered water charge by 2½p below what it would otherwise have been.
There is also provision in the Act to allow different meter rates to be set for different circumstances. This could mean lower rates for bulk users, but equally I have to say that there can be arguments for higher unit charges with increased consumption—to encourage conservation of water or the postponement of major capital investment in new reservoirs. Variable metered rates are not, however, normal practice in the water industry and no council has chosen this course of action.
The total cost of water in Grampian next year is rising by only 6·5 per cent.—less than the rate of inflation—and the new arrangements will do nothing to increase that cost. But although the total operating cost of supplying water will not be increased by the new arrangements, the cost to each class of consumer has varied. Metered water charges have risen generally throughout Scotland and now range from 21 p per cubic metre in Central region to 43p per cubic metre in Grampian region, as the hon. Gentleman said. The increases themselves will be from 18 per cent. in Fife to 109 per cent. in Grampian.
We have heard tonight, and in the media over recent weeks, the effect that the increases in metered charges will have on Grampian region. Let us look at the reasons for these increases. First, domestic water ratepayers have in the past subsidised the metered water rate by nearly one third. Secondly, the abolition of the public water rate, which was based on rateable values and could meet up to one third of the net cost, has resulted in that largely hidden element being incorporated in the new charges. Thirdly, the water supply system in Grampian is based almost entirely on river abstraction, a situation unique in Scotland but more familiar in England and Wales. This results in higher operating costs from pumping. Finally, the high level of capital expenditure, to which the hon. Gentleman referred, in recent years to service oil-related developments has incurred substantial loan charges, making the running costs for the region very high compared with the rest of Scotland. All these factors have combined to make the metered water rate of 43p per cubic metre the highest in Scotland.
I do not seek to underrate the impact that this year's increase, decided upon by Grampian regional council, will have on high users paying metered charges. However, industry should also bear in mind that the non-domestic rate poundage in Grampian is among the lowest in the country.
The legislation to give effect to the new arrangements was enacted by Parliament in 1987. Grampian regional council, if it had wished, could have prepared for the new charges by reducing the contribution from the public water rate in 1988–89. However, first warning of the new charges was given by the regional council in a statement issued in November 1988, and at a subsequent meeting with non-domestic ratepayers in December, guide figures were issued. Final figures were made known towards the end of January. There is little doubt that industries which use large amounts of water in Grampian and elsewhere will pay more under the new arrangements. However, there will be offsetting reductions to most consumers from the abolition of the public water rate in Grampian and elsewhere in Scotland.
We must remember that the baseline for calculating the business rate was reduced by 1·4p in Grampian to take account of the public water element. I can tell the House that many businesses, offices and shops will pay less for their water next year; in the case of large offices and shops in Aberdeen, the reduction could be over 80 per cent. For example, a major high street retail store in Aberdeen will actually save 87 per cent. on its water charges, despite the substantial increase in the metered rate.
Agricultural premises do not pay rates, except on the dwelling houses. They will therefore obtain minimal benefits from the abolition of the public water rate, in Grampian or elsewhere, and will have to pay the new metered charges. However, most farms have a metered supply, and those adults living in farm houses or cottages sharing that supply will not have to pay a personal community charge. In Grampian, this offsetting saving will amount this year to £30 per adult receiving water from the farm's metered supply, which would in many cases include agricultural workers and their wives living in the farm cottages. For the farms themselves, there may be opportunities to conserve water, and I have no doubt that it will be possible to eliminate unnecessary waste.
The hon. Gentleman has suggested phasing in the new arrangements, as was done in England and Wales when the Water Bill 1973 introduced fairness provisions for the first time. But at that time the basis of charging was not changed. We, however, had to introduce a completely new charge—the community water charge—and, as I have already explained, had to lay down the framework within which authorities have to decide how much of their expenditure should be apportioned to each class. Fairness provisions were therefore needed at the outset.
The hon. Gentleman and others have complained about high metered rates. I make no apology for prohibiting authorities from showing undue discrimin-ation for or against any class of consumer in making their

apportionment. That is only fair. Had the fairness provisions not been incorporated in the legislation, community water charges could have risen to subsidise the metered water charges in one area, and the reverse in others. It is only right that all sectors should pay their fair share.
The hon. Gentleman asked me about a meeting with Grampian regional council. Because the law gives Ministers no discretion over these matters, very little would be achieved by a meeting. However, I am sure that officials of Grampian regional council will have explored all their anxieties with my officials in the Scottish Office, and if such exploration were to indicate that a meeting between officials would be useful, of course one could take place.
The average metered charge for water in Scotland will be just over 28p per cubic metre. This is to be compared with the average equated meter charge in England and Wales, which is likely to be around 40p per cubic metre for 1989–90. In Europe, metered rates for 1988 were generally higher, with Germany at 67p per cubic metre, Belgium 53p and France 44p, and can be expected to be even higher in 1989–90.
Water in Scotland is still a good buy. Scotland remains an attractive location for companies seeking a European base, and the increase in metered water charges should not have a significant effect on the ability to attract new industries.
Industry is constantly pressing us to introduce a level playing field for business rates, and we are working towards this along a number of avenues. Change in the water charging arrangements is one.
It is only right that people should pay for what they use, and get what they pay for. I believe that there is a general acceptance among those who have commented on the changes that the move towards transparency of costs and fair allocation among users is not only just but long overdue.

Question put and agreed to.

Adjourned accordingly at two minutes past Two o'clock.